Economics · International Finance - Money Market Hedging
Which one of the following is NOT an advantage of money market hedging?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It is simpler to manage than a forward contract✓
- 2It is feasible for hedging currencies where forward contracts are unavailable
- 3Provides flexibility with regard to the amount to be covered
- 4Fixes the future rate, thus eliminating downside risk exposure
Correct answer
It is simpler to manage than a forward contract
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