In recent years, with the economy of our country gradually transforming from high speed growth to quality development, due to the upgrading sino-US trade friction, the complicated international political relations, the increasing RMB exchange rate volatility and the impact of rising labor costs, many manufacturing listed companies in our country faces various risks, and their innovation behavior have been affected a lot as well. At the same time, with the emergence of financial derivatives,

more »

... listed manufacturing companies began to increase capital allocation of financial derivatives to hedge risks, trying to stabilize corporate cash flow, increase investment in R&D innovation. Therefore, this paper takes China's A-share listed manufacturing companies from 2018 to 2020 as the research object to conduct an empirical study on the relationship between the use of financial derivatives and enterprise innovation behavior of listed manufacturing companies.The results show that :(1) in the context of sino-US trade friction, the use of financial derivatives still has a positive effect on firms' innovation behavior; (2) If enterprises use financial derivatives for speculative purposes, it will not promote the innovation of enterprises.