Contingent Interest Rate Hedges
Selim Toker
30 years: Derivatives & risk management
In this video, Selim has explained the context in which rate risk arises in event-driven transactions, and discussed the factors that will drive the pricing of a deal contingent hedge to eliminate this risk. He further examined the reasons why the pricing might differ from an FX DC.
In this video, Selim has explained the context in which rate risk arises in event-driven transactions, and discussed the factors that will drive the pricing of a deal contingent hedge to eliminate this risk. He further examined the reasons why the pricing might differ from an FX DC.
Contingent Interest Rate Hedges
9 mins 29 secs
Deal contingent transactions allow a buyer to hedge market risks that arise between the signing and closing of a transaction. The risk is mitigated by the fact that if the transaction fails to close when conditions precedent are not met, then the hedging trade will disappear at no cost to the buyer. This video will examine how interest risk arises in event-driven deals and also the factors that drive the pricing of the IRDC product.
Key learning objectives:
Understand the situations in which interest rate DCs are an appropriate hedging strategy
Identify the drivers of the IRDC product pricing
Selim Toker
Related videos
Global Asset Managers Regulation Introduction
Giles provides a high-level overview of asset management regulation across the world. Specifically, what's on the regulatory agenda and what the current international standards are, including how foreign portfolio management and investment is regulated.
Giles Swan • 18:16