Hedging

1.Currency swap is a method of

• hedging against foreign exchange risk.

• speculating in foreign exchange.

• leverage instrument used by cooperative banks.

2.When foreign currency assets and liabilities match in terms of amount of exposure and timing of maturities, it is described as

• Financial hedge

• Natural hedge

• Perfect hedge

• Netting

3.How many types of hedging are there.

• 3

• 4

• 5

• 6

4. __________ are those who enter into a derivative contract with the objective of covering risk arising out of

price fluctuat.

• ARBITRAGEURS

• SPECULATOR

• Hedgers

5.How many types of hedging are there?

• 2

• 3

• 4

• 5

6.Hedging against investment risk means strategically using financial instruments or market strategies.

• strategically

• Financial

• Market trade

7.Hedging a single stock position using _____.

• Futures

• Forward

• Option