Until recently, corporate exposure to market risk was largely due to the absence of any practical ways to transfer risk among different parties. Managers simply accepted the volatility associated with these risks as the cost of doing business. With the rapid pace of development in global financial markets, this has changed dramatically. Today, managers have a plethora of derivative-based tools to manage financial risks that were previously considered un-hedgeable. Some of the more common risks are:
August 01, 2005