Non-deliverable forward contracts (NDFs) are frequently used for currencies in emerging markets.

Question

Quizplus · Accepted Answer

Non-deliverable forward contracts (NDFs) are commonly used for currencies in emerging markets because they are not internationally traded or convertible, making it difficult to access hedging instruments like currency futures or options. NDFs allow investors to hedge against currency risk in these markets.

Non-Deliverable Forward Contracts (NDFs) Are Frequently Used for Currencies in Emerging