Hedging Currency Exposures

Hedging Currency Exposures
Author: Brian Coyle
Publisher: Global Professional Publishi
Total Pages: 194
Release: 2000
Genre: Business & Economics
ISBN: 9780852974384

� Fully updated version of text formerly used for training by BPP � Diagrammatic representation of deal structures, pricing, and modeling � Full glossary of terms � International perspective, examples in US$ � Clear logical explanation of processes, markets, and products This manual explains the techniques for identifying and covering exposure to adverse movements in foreign exchange rates. It provides practical examples of transaction, translation, and economic risk and shows how a hedging strategy can be arrived at. The hedging strategy will depend upon whether the attitude to risk is adverse, seeking, or neutral. This book examines these attitudes in turn and compares these hedging methods through worked examples. Also included is an analysis of accounting and tax implications. This expansive new range of risk management texts has undergone extensive re-writing to give each book in the series an international perspective. Each explains and analyses core aspects of risk assessment and management in a way invaluable to students and useful to practitioners. All of these titles adopt a practical and clear approach to their subject. All are fully updated versions of a series of books previously produced by training experts at BPP.

Some Like It Hedged

Some Like It Hedged
Author: Momtchil Pojarliev
Publisher:
Total Pages:
Release: 2018
Genre:
ISBN: 9781944960582

Cross-Border Currency Exposures

Cross-Border Currency Exposures
Author: Luciana Juvenal
Publisher: International Monetary Fund
Total Pages: 67
Release: 2019-12-27
Genre: Business & Economics
ISBN: 1513525379

This paper provides a dataset on the currency composition of the international investment position for a group of 50 countries for the period 1990-2017. It improves available data based on estimates by incorporating actual data reported by statistical authorities and refining estimation methods. The paper illustrates current and new uses of these data, with particular focus on the evolution of currency exposures of cross-border positions.

Corporate Foreign Exchange Risk Management

Corporate Foreign Exchange Risk Management
Author: Lars Oxelheim
Publisher: John Wiley & Sons
Total Pages: 232
Release: 2020-06-15
Genre: Business & Economics
ISBN: 1119598869

A practical and accessible guide that demystifies ForEx risk for managers in all areas of business Virtually any organisation active in the global economy is impacted by fluctuations in foreign exchange (FX or ForEx) markets. Managers need to understand this increasingly complex issue and measure their firm’s exposure to risk. Corporate Foreign Exchange Risk Management is an in-depth yet accessible guide on effective ForEx exposure management. Designed for professionals responsible for managing a profit & loss or balance sheet influenced by ForEx fluctuations, it enables risk managers to navigate the interconnected worlds of financial management and economics. This innovative guide integrates academic discussion of the economics of risk management decisions and pragmatic advice for various situations in which performance measures affected by accounting standards are paid considerable attention. Readers are provided with the tools and knowledge required to handle a broad range of issues related to ForEx risk management. Clear, non-technical chapters demystify concepts that often appear complicated and confusing to managers. Written by globally-recognised experts in corporate finance, risk management and international business, this book: Employs a reader-friendly narrative style to explain complex concepts Provides a clear, actionable risk management strategy which can be used in a variety of businesses Places all concepts in relatable, real-world contexts Explains important academic research to practitioners in plain English Includes effective pedagogical tools and explanations, straightforward examples and end-of-chapter summaries which highlight key points Corporate Foreign Exchange Risk Management is a must-read for any manager who deals with corporate exposure to ForEx risk, as well as analysts wishing to better understand the relation between corporate performance and ForEx fluctuations and students of corporate risk management.

Discriminatory Pricing of Over-the-Counter Derivatives

Discriminatory Pricing of Over-the-Counter Derivatives
Author: Hau Harald
Publisher: International Monetary Fund
Total Pages: 45
Release: 2019-05-07
Genre: Business & Economics
ISBN: 1498303773

New regulatory data reveal extensive price discrimination against non-financial clients in the FX derivatives market. The client at the 90th percentile pays an effective spread of 0.5%, while the bottom quarter incur transaction costs of less than 0.02%. Consistent with models of search frictions in over-the-counter markets, dealers charge higher spreads to less sophisticated clients. However, price discrimination is eliminated when clients trade through multi-dealer request-for-quote platforms. We also document that dealers extract rents from captive clients and market opacity, but only for contracts negotiated bilaterally with unsophisticated clients.

Managing Global Financial and Foreign Exchange Rate Risk

Managing Global Financial and Foreign Exchange Rate Risk
Author: Ghassem A. Homaifar
Publisher: John Wiley & Sons
Total Pages: 400
Release: 2003-12-22
Genre: Business & Economics
ISBN: 0471281158

A comprehensive guide to managing global financial risk From the balance of payment exposure to foreign exchange and interest rate risk, to credit derivatives and other exotic options, futures, and swaps for mitigating and transferring risk, this book provides a simple yet comprehensive analysis of complex derivatives pricing and their application in risk management. The risk posed by foreign exchange transactions stems from the volatility of the exchange rate, the volatility of the interest rates, and factors unique to individual companies which are interrelated. To protect and hedge against adverse currency and interest rate changes, multinational corporations need to take concrete steps for mitigating these risks. Managing Global Financial and Foreign Exchange Rate Risk offers a thorough treatment of price, foreign currency, and interest rate risk management practices of multinational corporations in a dynamic global economy. It lays out the pros and cons of various hedging instruments, as well as the economic cost benefit analysis of alternative hedging vehicles. Written in a detailed yet user–friendly manner, this resource provides treasurers and other financial managers with the tools they need to manage their various exposures to credit, price, and foreign exchange risk. Managing Global Financial and Foreign Exchange Rate Risk covers various swaps in this geometrically growing field with notional principal in excess of $120 trillion. From caplet and corridors to call and put swaptions this book covers the micro structure of the swaps, options, futures, and foreign exchange markets. From credit default swap and transfer and convertibility options to asset swap switch and weather derivatives this book illustrates their simple pricing and application. To show real-world examples, each chapter includes a case study highlighting a specific problem, as well as a set of steps to solve it. Numerous charts accompanied with actual Wall Street figures provide the reader with the opportunity to comprehend and appreciate the role and function of derivatives, which are often misunderstood in the financial market. This detailed resource will guide the individual, government and multinational corporations safely through the maze of various exposures. A must-read for treasures, controllers, money mangers, portfolio managers, security analyst and academics, Managing Global Financial and Foreign Exchange Rate Risk represents an important collection of up-to-date risk management solutions. Ghassem A. Homaifar is a professor of financial economics at Middle Tennessee State University. He has Master of Science in Industrial Management from State University of New York at Stony Brook and PhD in Finance from University of Alabama in 1982. He is the author of numerous articles that have appeared in the Journal of Risk and Insurance, Journal of Business Finance and Accounting, Weltwirtschsftliches Archiv Review of World Economics, Advances in Futures and Options Research,Applied Financial Economics, Applied Economics, International Economics, and Global Finance Journal.

Currency Risk Management

Currency Risk Management
Author: M. S. V. Prasad
Publisher: Vernon Press
Total Pages: 140
Release: 2019-12-09
Genre: Business & Economics
ISBN: 1622735692

Currency Risk Management (CRM) is vital for any business engaging in international trade. Fluctuations and uncertainty within currency markets mean that businesses must seek to effectively manage and anticipate potential risks when striking international deals. In a rapidly changing and volatile global business environment, CRM is now more than ever of critical importance. However, what risks should businesses hedge – and how? With so many viable strategies for hedging currency exchange risk, it is crucial that businesses either outsource or have a specialized team to ensure effective and efficient management of currency exchange risks. But how does CRM operate in an emerging market? And what are the key factors that influence the chosen CRM strategies? Organized in association with Indian Bank, GITAM’s national conference on CRM sought to highlight the trends, problems, and prospects of CRM in India. Taken from the conference proceedings, this book presents 9 innovative research papers that consider differing CRM practices. From a comparative study of India and China to an assessment of CRM strategies used by commercial Indian banks, this book offers an invaluable insight into CRM from the perspective of an emerging market. As a whole, this book addresses India’s shift to a market-determined exchange rate regime and the inevitable problems caused the by the high volatility of exchange rates. Aimed at students enrolled in commerce and management courses, this collection of research papers will also be of interest to researchers in international finance.

Management and Control of Foreign Exchange Risk

Management and Control of Foreign Exchange Risk
Author: Laurent L. Jacque
Publisher: Springer Science & Business Media
Total Pages: 392
Release: 2013-12-01
Genre: Business & Economics
ISBN: 9400918062

Since I first published Management of Foreign Exchange Risk (Lexington Books, 1978), financial innovation-spurred, in part, by exploding volatility in currency prices-has revolutionized the theory and praxis of foreign exchange risk management. Old-fashioned forward contracts have surrendered market share to currency swaps and options as well as to their perpetually multiplying derivatives. Interestingly, forex derivatives now provide a low cost and highly efficient method of transferring risk from the firms that are exposed to risk but which would rather not be (i. e. , risk-hedgers) to those which are not exposed but which-in exchange for a fee-would assume some exposure to risk (i. e. , risk bearers). Perhaps more importantly, foreign exchange risk management, which was once a fairly mechanical task confmed to the international treasury function, is now permeating global strategic management. Indeed, since the demise of the Bretton Woods system of pegged exchange rates, the cost of forex hedging instruments has fallen so dramatically that firms can readily avail themselves of hedging products which can reduce unwanted risk, thereby potentially gaining a competitive advantage over rivals that do not. Management and Control of Foreign Exchange Risk has grown out of a fundamental revision of my earlier work published almost 20 years ago. In the process, my thinking about risk and its mathematics has greatly benefitted from my association with John Cozzolino and Charles Tapiero.