Corporate Foreign Exchange Risk Management

Index

• Note: Page references in italics refer to figures and tables.

• A
• ABB, 129
• academic finance
  • cash flow hedging, 18–19, 20
  • on corporate disclosures, 178, 179
  • earnings management, 25
  • guidance on options vs forwards, 100
  • hedging decisions, 17–18
  • on international acquisitions, 165
  • limitations of, xiii–xiv
  • selective hedging, 9
• accounting standards, 65, 67–8, 105–6
  • derivatives, 106–8
  • driving too little FXRM disclosure, 180
  • mismatch in, 117
• acquisitions, 165
• additional paid‐in capital, current rate method, 51
• agent‐principal conflict, 18
• aluminium, 40
  • Hydro, 148–9
• American options, 99
• ammonia production, 42–3
• analysts, 23–4
• analytical methods, hedge effectiveness, 122–3
  • regression analysis, 43–4, 46, 187
• anticipated transaction exposure, 33, 34–5
• appreciation of a currency, 10, 47, 80, 164
• Argentine Peso, 6
• Asian options, 99
• asset sales, 29
• assets (A), 111
  • sold in a fire sale, 19
• asymmetry, 21
  • cash flow hedging, 18–19
  • net income volatility, 25–6
  • options, 95–6, 97–8
• Australian dollar, 5
• average exchange rate, 51

• B
• back‐testing, correlations, 153
• balance sheet exposure to FX, 65–6
  • exposure matrix, 71–4
  • internal transactions, 74–7
  • non‐monetary assets and liabilities, 66–70
  • translation of income statement, 78–80
• banks
  • ECB, low interest rate set by, 2
  • and internal hedging system, 133–4
  • negotiating better terms from, 130
• Barings Bank, 84
• basis points, 11
• Big Mac Index, 3–4
• board of directors, 141–2, 143, 155, 192
• Boliden, 136
• borrowing capacity, 19–20
• bottom‐up method, commercial ...