Multiple Choice
What is overhedging?
A) Selectively hedging a proportion of an FI's balance sheet position.
B) Choosing to bear some interest rate risk as well as credit and FX risks.
C) Reducing the risk to the lowest level possible.
D) Using more hedge vehicles than is necessary to offset the risk in the cash asset.
Correct Answer:
Verified
Correct Answer:
Verified
Q3: Macrohedging uses a derivative contract, such as
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