Co-ordinator and Currency risk: Difference between pages
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The risk of losses or other adverse effects resulting from a change in a foreign exchange rate, or from other unfavourable changes in relation to a foreign currency. | |||
Examples include: | |||
*A final receipt/payment of a different amount of domestic currency equivalent, than expected when a currency transaction was committed to (transaction risk) | |||
*A change in asset/liability values in a balance sheet, profit/loss in an income statement (translation risk) | |||
* | *A change in competitiveness as rates change relative to buyers, suppliers or competitors (economic risk). | ||
* | |||
A more complex area of foreign exchange risk concerns contingent, or pre-transaction risk. | |||
Also known as Currency exposure or Foreign exchange risk. | |||
== See also == | |||
* [[Contingent risk]] | |||
* [[Cross-currency interest rate swap]] | |||
* [[Currency management]] | |||
* [[Foreign exchange risk]] | |||
* [[Transaction exposure]] | |||
* [[Translation exposure]] | |||
===Other links=== | |||
[http://www.treasurers.org/node/5281 Currency risk, Will Spinney, ACT 2009] | |||
[[Category:Manage_risks]] | |||
[[Category: |
Revision as of 14:43, 30 May 2016
The risk of losses or other adverse effects resulting from a change in a foreign exchange rate, or from other unfavourable changes in relation to a foreign currency.
Examples include:
- A final receipt/payment of a different amount of domestic currency equivalent, than expected when a currency transaction was committed to (transaction risk)
- A change in asset/liability values in a balance sheet, profit/loss in an income statement (translation risk)
- A change in competitiveness as rates change relative to buyers, suppliers or competitors (economic risk).
A more complex area of foreign exchange risk concerns contingent, or pre-transaction risk.
Also known as Currency exposure or Foreign exchange risk.
See also
- Contingent risk
- Cross-currency interest rate swap
- Currency management
- Foreign exchange risk
- Transaction exposure
- Translation exposure