Management of Exchange Rate and Interest Rate Risk
A study of financial strategy is not complete without the study of the risks involved in this type of strategy. The present chapter acquaints readers with such risks. The objective is to:
- Explain the nature of different forms of exchange rate risk and how they are measured.
- Describe the contractual, natural, and other hedging techniques to manage exchange rate risk.
- Explain the nature of interest rate risk and the techniques to manage such risks.
While the preceding chapter discusses important financial strategies aimed at maximising corporate wealth ...