Foreign exchange volatility and its effect on the investments of the companies of the Mexican Stock Exchange
Keywords:
Exchange cycles, Long term active investments, Mexican Stock ExchangeAbstract
Currency volatility and its effect on investment in productive assets in the companies of the Mexican Stock Exchange during 2010-2018 are analyzed. To assess whether the investment is unequal in each of the exchange cycles, three financial multiples were used that measure: (1) the investment index, (2) its turnover and (3) its profitability. By means of the Analysis of Variance, the statistical difference of the average values of the three multiples was tested through the three exchange cycles studied. It was found that the amount of investment in productive assets was reduced when passing through the cycles of appreciation-depreciation-appreciation, these decisions reflect the postulates of the theory of animal spirits of Keynes that explain the influence of the emotional waves of the administrators in the Decision making, in this case it was to decrease idle investment, which increased the productivity and profitability of productive investment.
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