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Foreign Direct Investment
Foreign direct investment (FDI) is an important factor in acquiring investments and grow the local…
Posted inInternational Finance
Techniques to Reduce Economic Exposure
International firms can use five techniques to reduce their economic exposure − ● Technique 1 − A company can…
Posted inInternational Finance
Economic Exposure – A Practical Example
Suppose you own and rent out a condominium in Europe. A property manager recruited by…
Posted inInternational Finance
Regression Equation
Analysts can measure economic exposure by using a simple regression equation, shown in Equation 1. P…
Posted inInternational Finance
International Finance – Economic Exposure
Economic exposure is the toughest to manage because it requires ascertaining future exchange rates. However,…
Posted inInternational Finance
Hedging Translation Exposure
The above exhibit indicates that there is still enough translation exposure with changes in the…
Posted inInternational Finance
Translation Exposure – An Exhibit
The following exhibit shows the transaction exposure report for Cornellia Corporation and its two affiliates.…
Posted inInternational Finance
International Finance – Translation Exposure
Translation exposure, also known accounting exposure, refers to a kind of effect occurring for an unanticipated change…
Posted inInternational Finance
Operational Techniques for Managing Transaction Exposure
Operational strategies having the virtue of offsetting existing foreign currency exposure can also mitigate transaction…
Posted inInternational Finance
Transaction Hedging Under Uncertainty
Uncertainty about either the timing or the existence of an exposure does not provide a…