Hedging through derivatives contact

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

• Hedgers

• SPECULATOR

5)Hedging against investment risk means strategically using financial instruments or market strategies

• strategically

• Financial

• Market trade

• 5

6)Hedging a single stock position using

• Futures

• Forward

• Option