Futures Trading and Corporate Financialization: A Quasi-Natural Experiment From the Launch of China's Crude Oil Futures

This study examines the impact of China's crude oil futures trading on corporate decision-making at the firm level. By analyzing Chinese listed companies spanning from 2010 to 2022, we identify a significant negative causality of China's crude oil futures trading on the degree of financialization in energy-dependent enterprises. Mechanism analysis further demonstrates that China's crude oil futures trading substantially strengthens corporate risk management capacity, thereby reducing precautionary motivations for financial asset holdings. Specifically, energy-dependent firms exhibit a marked propensity to reallocate short-term liquidity from financial investments to crude oil futures positions. Heterogeneity analysis shows that the impact of China's crude oil futures on the financialization level of energy-dependent firms is more pronounced among state-owned enterprises and firms facing heightened competitive pressures. This paper offers micro-level insights into the relationship between commodity futures trading and corporate decision-making, emphasizing the significance of financial innovation in supporting China's real economy development.