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Sir is it true that when there is a gain on hedged item than there will be a loss on hedged instrument and vice versa. If it is true or false than why?
It depends on the instrument being used for the hedging. If we are using interest rate futures then what you say is true (and is the whole point of using futures).
Have you watched my free lectures on interest rate risk management, because I explain all this in detail?
Swaps are not done to hedge risk, they are done so as to end up paying less interest than without the swap.
Again, have you watched the free lectures on this?
Sir I watched it a long time ago, actually this question was related to SBR. In SBR there was a question related to Derivatives IFRS-9.
Thank you Sir for clarifying me on this. I will surely watch it again. 🙂
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