xvi PREFACE TO SECOND EDITION
Chapter 5, “Management of Foreign Exchange Exposure and Risk,” highlights different
kinds of foreign exchange exposures and risks faced by firms and discusses how such risks
can be managed.
Chapter 6, “Currency Forwards and Futures,” Chapter 7, “Currency Options,” and
Chapter 8, “Financial Swaps,” deal with derivatives. Chapter 6 highlights how the for-
ward and futures markets operate and elaborates on the trading strategies associated
with futures. The chapter also introduces the concept of interest rate futures to readers.
Chapter 7 explains various currency option trading strategies. Option pricing is the focus
of this chapter. A comparison of options, forwards, and futures provides an overview of the
various ...