1 / 19

Management of Transaction Exposure chapter 13

Transaction Exposure. Arises from changes in the value of past contractual obligations in FC (e.g. payables and receivables, loans and deposits)Example: Suppose that on January 1, 2005 Ford is awarded a contract to supply trucks to Dutch army forces. On December 31, 2005, Ford will receive a payme

tom
Download Presentation

Management of Transaction Exposure chapter 13

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

    1. Management of Transaction Exposure (chapter 13)

    2. Transaction Exposure

    4. Without hedging

    5. Hedging strategies

    6. Forward market hedge

    7. Forward Market Hedge

    8. Options Market Hedge

    9. Options Market Hedge

    10. Hedging certain future cash flows: Ford example

    12. Options Hedging: importer of British woolens

    13. Hedging through Invoice Currency

    14. Hedging via Lead and Lag

    15. Exposure Netting

    16. Observations

    17. Should the Firm Hedge?

    18. Should the Firm Hedge?

More Related