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Will do. Thanks!

Hi, In Chapter 8, definition of short hedge is given as - "A short forward or futures hedge is an agreement to sell in the future and is suitable for a hedger who owns (or will own) an asset that needs to be sold in the future. The classic example is a farmer who wants to lock in the sales...

Thank You, Understood now.

Thanks for responding. However my question was slightly different. I appreciate your example where in the Price movement towards close to maturity moved as company expected however my point is, what if the price movement is unfavourable to the company/investor? Does that uncertainty with the...

Hi , this is related to Futures Contract : 1. Closing Out Positions : In Chapter 7 Futures Markets (Page # 5 study notes) , it says -"Most futures contracts do not lead to delivery, as most trades close out their positions before delivery. Closing out a position means taking an offsetting...

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In terms of Credit Risk, what is the meaning of replacement value? "An asset has credit risk when it is in a position with positive replacement value"

What is Curve Risk? Can this be explained with example. ANd what is DV01 ? Can this also be explained with example and how it is tied to Curve Spread? In the text below, what is it meaning of non parallel shifts? Curve risk is when the fixed income is hedged against parallel shifts in the...

Can Basis Risk be explained with an example , on how the risk is calculated(basis risk that is) when the Price of the "Exposure" and "Hended Product" goes out of sync. Could this be explained with a detailed and a simple example please.

Hi, With respect to ERM , does it follow a "horizontal" orientation OR a "top down approach". In Chapter 1 , Page # 6, it sounds like it follows both orientations as mentioned in the notes. 1. ERM has a top-down orientation or at least incorporates a top-down perspective: the board of...

Hi, In chapter 1 , Page 9 - the Market risk is explained as - "Market risk specifically depends on the context. For example, In the case of a fund, the fund may be marketed as tracking a specific benchmark. Here, market risk is important to the extent that it creates a risk of tracking error."...