This paper examines the foreign economic exchange exposure from a sample of quoted companies in the Spanish Stock Exchange for two different stages: Strong Peseta period (1988-91) and weak period (1992-95). Therefore, time series regressions of stock returns on market return and movements in the exchange rates are carried out. Next, a cross-sectional analysis is executed in order to determine if the level of economic exposure explains export, import and foreign debt levels. The results indicate the existence of economic exposure in a reduced number of companies. We also found that the cross-sectional variation in exchange rate risk of firms is related to operational characteristics.

Key words: foreign exchange rate risk, economic exposure, stock prices.
JEL classification: L16.