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RISK MANAGEMENT
By Syndicate 1
PRESENTED BY
Hanindita Guritna
29114713
Hussein Al-Muhtadeebillah
29114737
Felix Terahadi
29114744
Rini Amelia
2911857
Hidratul Fidic Dirgantara
2911859
ECONOMIC
FLUCTUATION
example
Destabilized
Performance
24%
50%
Protect fromRISKS
using
SWAP
FORWARD
DERIVATIVES
FUTURES
BUT
OPTIONS
3 | Cash Flow
WHY
HEDGE? ?
Effect of Hedging
WHEN TO
HEDGEOR NOT
E xchange
Rates
Interest
Rate
Cash Flow
CASH
RISK
INVESTMENT
DEMYSTIFYING DERIVATIVES
Forward Based Contracts:
Forward, S waps, and Futures
+ Linear
+ Non-linear
+ No Money Down
+ Money Down
+ Settlement at Maturity
+ Settlement at Exercise
+ C ustomization
+ C ustomization
No money changes hands when the contract is C ontract requires an initial investment when
initiated
the position is established
Forward contracts are not settled until their
maturity date
Maturity date and characteristics of underlying
assets can be customized
FOR MANAGERS
1
COMPANIES
SHOULD NOT
adopt the same
HEDGING STRATEGY
COMPANIES
from RISK
EVEN
MAY BENEFIT
MANAGEMENT
COMPANIES
with
Conservative
Capital
Structure
can
BENEFIT
from HEDGING
affects
FOREX
RISK
Cash Flows
&
Investment
Opportunities
COMPANIES SHOULD
pay ATTE NTION
to competitors
HEDGING STRATEGY
the choice of
DERIVATIVES
be delegated to
6
CANNOT
FINANCIAL SPECIALISTS