Forex and interest risk

1. Correct (and netting as well, but that is easy and obvious) 2. Correct - no calculations, but being aware what they are. 3. He also expects you to know about foreign exchange futures and options, but there will not be calculations on these.

If the is a payment of $100 in 6 months time, and a receipt of $70 in 6 months time, then you simply net them off and you are at risk on a net payment of $30 in 6 months. It is on this $30 then you would then look at forward rates or money market hedging.

Great :-)