
- UID
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- 注册时间
- 2011-7-11
- 最后登录
- 2016-4-19
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If hedged - taking position in futures (short)
If Oil price increases—-Company Sales income increases—future posiiton loss ( futures prices also increases& we are short here) —-but home currency appreciates in $ terms (due to +ve correlation with oil)– lowering demand from US - Double whampy effect
If Oil price decreases—-Company Sales income decreases—–future posiiton profits–but home currency depreciates (due to +ve correlation ) increasing demand from US - Company is better off
But remains exposed to currency risk |
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