cycle‚ and before it knew exactly how much foreign currency it needed. * A key feature was that AIFS guaranteed that its prices would not change before the next catalog‚ even if world events altered AIFS’ cost base. * According to AIFS’s hedging policies‚ it has to predict the exchange rate fluctuation‚ the number of customers‚ which may be different with the final exchange rate and the volume when selling currencies‚ so the currency exposure happens. The actions of AIFS’s competitors may
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Exchange Hedging Strategies at General Motors: Transactional and Translational Exposure Problem Statement In September of 2001 General Motors (GM) was faced with a billion dollar exposure to the Canadian dollar. At the time‚ North America represented approximately three-quarters of GM’s total sales and this large exposure to the CAD could significantly affect GM’s financial results. GM had a passive strategy of hedging 50% of its exposure; this paper explores the impact of hedging 75%
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how to proceed; was it worth the costs to increase the size of GM’s hedge position beyond the standard policy or should GM Argentina rely on other approaches to cope with the expected devaluation? Appraisal of GM’s Passive Hedging Strategy GM’s passive hedging strategy is reflective of its policy to focus on its underlying business rather than speculate on the movements of foreign currency. There are two main types of currency exposure. The first being economic risk. This deals with the impact
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firm manage foreign exchange exposures? The case examines transactional and translational exposures and alternative responses to these exposures by analyzing two specific hedging decisions by General Motors. Describes General Motors’ corporate hedging policies‚ its risk management structure‚ and how accounting rules impact hedging decisions. The company is considering deviations from prescribed policies because of two significant exposures: an exposure to the Canadian dollar with adverse accounting
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INTERNATIONAL INVESTMENT AND PORTFOLIO MANAGEMENT BMW: Currency Hedging 2007 BY AJAY BANSAL‚ VAIBHAV SINGH‚ VIJAY VERMA‚ TANMAY JAIN‚ LU YOU‚ SEBASTIAN DOMINITZKI Background 2 Revenue Growth in 2007: 14‚3% €56‚018 Million 1‚500‚678 BMW‚ MINI and Rolls-Royce brand cars were sold during 2007 (9.2% increased) >25% of sales take place in US Crisis in US Credit Market adverse impact on the share prices of European exporting companies BMW common stock: 2.7% drop US dollar dropped
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Apache Indian Research Paper Apache‚ that very name struck unforgiving fear in the minds of settlers and tribes throughout the Great Plains and the southwest. Fierce Apache warriors were quick to learn the tactics of their enemies and use it against them. Not only were the Apache cheated by the Americans‚ but the Spanish (which arrived in 1541) as well. Apache culture is rich with tradition and conflict just like the land they once roamed. Apache Culture The Apache people arrived in 850
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PLEKHANOV RUSSIAN ECONOMIC UNIVERSITY INTERNATIONAL FINANCIAL MANAGEMENT Case Study REPORT Hedging Currency Risks At AIFS Professor: Yulia Y.Finogenova Performed by: Budeanu Diana Gabaydullin Ilnar Kulikova Ekaterina
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Southwest Airlines Fuel Hedging and Relations to Profitability Abstract In order to stay airborne‚ a passenger airline has to consistently generate profits. Profits come only from paying passengers‚ hence all stratagems must be customer oriented. In a scenario where there are many airlines competing with each other‚ one way of attracting passengers is to keep the cost of flying low‚ while providing value for money. On the other hand‚ expenses must tightly controlled to reach and stay at the
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Reading Response Of all of the perspectives given to me‚ I believe that the apache tribe had the most reasonable and justified perspective. The apache only resorted to violence when they were avenging a tribe member that was murdered‚ or when they were trying to defend themselves‚ unlike the settlers‚O’odham tribe‚ Mexican Americans‚ and U.S government who would kill simply because they didn’t like them. The apache tribe had to act the way they did because they were in an “eat or be eaten” situation
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Apache girls go through a rite of passage. The ceremony last for four day. This rite of passage is to build strength‚ endurance and the character of a woman. The ceremony takes place on the fourth of July. A lot of money‚ time and energy is spent on preparation for the ceremony. Preparation for the party gives added importance to the ceremony and prepares the girl mentally for what is going to happen and gives her time to clarify her responsibilities. The ceremony starts with the rise of the morning
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