Hedging

Question 1

Interest rate risk hedge:
How do you calculate cost of borrowing for Sterling interest rate options?

Answer 1

Question 2

Interest rate risk hedge:
How do you calculate cost of borrowing for FRA?

Answer 2

Question 3

Interest rate risk hedge:
How do you calculate cost of borrowing for OTC Interest rate options?

Answer 3

Question 4

Interest rate risk hedge:
Swaps ?

Answer 4

Question 5

What are the Advantages of Swaps ?

Answer 5

Question 6

What are the Disadvantages of Swaps ?

Answer 6

Question 7

FX risk hedge:
How do you calculate Sterling payment for OTC Interest rate options?

Answer 7

Question 8

FX risk hedge:
How do you calculate Sterling payment for Forward contract?

Answer 8

Question 9

FX risk hedge:
How do you calculate Sterling payment for MMH?

Answer 9

Question 10

FX risk hedge:
How do you calculate Sterling Receipt for Forward contract?

Answer 10

Question 11

FX risk hedge:
How do you calculate Sterling Receipt for MMH?

Answer 11

Question 12

FX risk hedge:
How do you calculate Sterling Receipt for OTC?

Answer 12

Question 13

Advantages and disadvantages of each hedging technique.

Answer 13