Bullion 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: | |||
(i) a final receipt/payment of a different amount of domestic currency equivalent, than expected when a currency transaction was committed to (transaction risk), or <br> | |||
(ii) a change in asset/liability values in a balance sheet, profit/loss in an income statement (translation risk), or <br> | |||
(iii) 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 == | == 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: | [[Category:Manage_risks]] | ||
Revision as of 14:52, 18 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:
(i) a final receipt/payment of a different amount of domestic currency equivalent, than expected when a currency transaction was committed to (transaction risk), or
(ii) a change in asset/liability values in a balance sheet, profit/loss in an income statement (translation risk), or
(iii) 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
