Hedge Strategy Analysis and Financial Analysis of Chinese Eastern Airlines

DOI

10.2991/978-94-6463-036-7_68How to use a DOI?

Keywords

Corporate background; Financial analysis; Fuel hedge

Abstract

Hedging is crucial to a company’s financial status, a good hedging strategy can effectively avoid the loss caused by price fluctuations. However, a bad hedging strategy can lead a company into a crisis. This paper aims to study the failed case of fuel option hedging of China Eastern Airlines in 2008. We make a financial analysis based on the company's basic background, financial situation, and stock price. On this basis, the hedging schemes of fuel long call options, short put options, and short Call options are analyzed respectively, and the reasons for the company's huge losses are finally obtained. This paper will provide a reference for airlines to make hedging plans in the future, so as to avoid inappropriate hedging decisions.

Copyright

© 2022 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Xincheng Du
AU  - Weiqiang Feng
AU  - Suyang Yao
PY  - 2022
DA  - 2022/12/31
TI  - Hedge Strategy Analysis and Financial Analysis of Chinese Eastern Airlines
BT  - Proceedings of the 2022 2nd International Conference on Economic Development and Business Culture (ICEDBC 2022)
PB  - Atlantis Press
SP  - 460
EP  - 465
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-036-7_68
DO  - 10.2991/978-94-6463-036-7_68
ID  - Du2022
ER  -