Banks must balance liquidity risk, interest rate risk, credit risk and currency risk while still generating sufficient profitability to satisfy its owners.
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Q5: A firm informs the bank they will
Q6: Microhedging is hedging the interest rate risk
Q7: For a given time period, assets that
Q8: Basis risk is the risk that the
Q9: A U.S. company has a euro denominated
Q11: To hedge a positive duration gap a
Q12: The VaR is typically used to measure
Q13: As interest rates increase, a long call
Q14: If the asset duration is less than
Q15: The sensitivity of the market price of
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