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Forums › ACCA Forums › ACCA FM Financial Management Forums › CAN ANYONE HELP ME IN DETAILS? I CANT UNDESTAND
P is due to receive $ 5M in 3 months time.
Spot: $ / £ 1.5384 – 1.5426
Current 3 months Interest rates : US Prime: 5.2 % – 5.8 %
UK LIBOR – 3.6 % – 3.9 %
SHOW HOW P CAN USE MONEY MARKET TO HEDGE THE RISK
I cannot believe that you are asking this here because it is the example in our free lecture notes and the lecture that goes with the chapter works through the example in detail.
You must watch the free lecture on foreign exchange risk management – I am certainly not going to type out the whole lecture here.
(In addition you have the answer typed out in the lecture notes!!)