Techniques for Managing Exchange Rate Exposure …

Techniques for Managing Economic Exposure p. 1 Classnote Prof. Gordon Bodnar Techniques for Managing Exchange Rate Exposure A firm's economic Exposure to the Exchange rate is the impact on net cash flow effects of a change in the Exchange rate. It consists of the combination of transaction Exposure and operating Exposure . Having determined whether the firm should hedge its Exposure , this note will discuss the various things that a firm can do to reduce its economic Exposure . Our discussion will consider two different approaches to handling these exposures: real operating hedges and financial hedges. Transaction Exposure Financial Techniques of Managing Transaction Exposure Transaction Exposure hedging should have been discussed in some detail in the previous international finance course; however, we will briefly go over the standard financial methods available for hedging this Exposure .

Techniques for Managing Economic Exposure p. 1 Classnote Prof. Gordon Bodnar Techniques for Managing Exchange Rate Exposure A firm's economic exposure to the exchange rate is the impact on net cash flow effects of a change in the

Tags:

  Rates, Technique, Exchange, Managing, Techniques for managing exchange rate

Information

Related search queries