As a result of the increasing volatility in financial markets, the use of financial derivative instruments (forward, futures, option, and swap) has become widespread particularly between large firms around the world.Market risk can be grouped into three categories: exchange rate risk, interest rate risk and commodity price risk.By employing financial derivatives, companies can manage these risks. It is required by International Financial Reporting Standards (IFRS) to reveal their financial positions on financial instruments in their financial reports.The related details in financial reports regarding financial derivatives make it possible to do empirical research on the impact of derivative use on firm value. Along with the mixed results on the relationship among hedging and firm value, empirical research that question the impact of hedging on firm operating activities have been unexpectedly missing. In this study, we aim to examine a significant type of firm operations, cross-border mergers and acquisitions, which is well known for changing a firm's financial risk exposure. By studying the effect of hedging on firm performance through cross-border M&As, we aim to find out whether and in what way risk management affects firm performance. With a sample of 537 cross-border mergers and acquisitions