Archive | Hedging Techniques

Hedging: Costs and Types | Company | Financial Management

In this article we will discuss about the cost and types of hedging adopted by companies to mitigate exchange rate risk. Cost of Hedging: Companies use contractual and non-contractual methods to hedge exchange rate risk. Transaction exposure is hedged through contractual and non-contractual methods. Translation exposure can be hedged through contractual methods. Operating exposure is difficult to hedge given the [...]

By |2017-12-07T08:48:22+05:30December 7, 2017|Hedging Techniques|Comments Off on Hedging: Costs and Types | Company | Financial Management
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Simple Hedging Techniques of a Firm | Foreign Exchange | Management

The following points highlight the fifteen main simple hedging techniques adopted by a firm for foreign exchange risk management. The techniques are: 1. Doing Nothing 2. Pre-Emptive Price Variation 3. Risk Sharing 4. Maintaining a Foreign Currency Bank Account 5. Transfer Pricing 6. International Forfaiting 7. Discounting of Bills of Exchange 8. Money Market Operations 9. Secured Exchangeable Bonds and [...]

By |2017-07-07T16:21:38+05:30July 7, 2017|Hedging Techniques|Comments Off on Simple Hedging Techniques of a Firm | Foreign Exchange | Management
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