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Under / Over hedge in Interest Rate Management

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Under / Over hedge in Interest Rate Management

  • This topic has 1 reply, 2 voices, and was last updated 10 years ago by John Moffat.
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  • Author
    Posts
  • May 27, 2015 at 1:32 am #249375
    P4
    Member
    • Topics: 16
    • Replies: 34
    • ☆☆

    Hello John,

    Can you please explain what are we supposed to do if we Over or Under Hedge in Intrest rates. In currencies we buy/sell the currencies at the forward rate, is there some adjustment in Interest rates aswell?

    May 27, 2015 at 8:40 am #249464
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54665
    • ☆☆☆☆☆

    No – that problem only exists for currency hedging.

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