Relationships and interactions of foreign exchange hedging

Relationships and interactions of foreign exchange hedging


In teams, construct a map illustrating the concepts, relationships, and interactions of foreign exchange hedging.

Your map should explore the details, differences, and similarities in the following aspects of Foreign Exchange Hedging:

· Types of exposure and details of each
· Participants in the FX market
· Sources of FX risk that lead to hedging
· Financial contracts to offset the risk
· Operational contracts to offset the risk
· Fixed vs. floating rates
· FX rate quotation methods
· FX rate forecasting

What Are Concept Maps?


Concept maps are graphical tools for organizing and representing knowledge. They include concepts, usually enclosed in circles or boxes of some type, and relationships between concepts indicated by a connecting line linking two concepts. Words on the line, referred to as linking words or phrases, specify the relationship between concepts. We define a concept as a perceived regularity in events or objects or records of events or entities designated by a label. The label for most concepts is a word, although sometimes we use symbols such as or %, and sometimes more than one word is used. Propositions are statements about some object or event in the universe, either naturally occurring or constructed. Propositions contain two or more concepts connected using linking words or phrases to form a meaningful statement. Sometimes these are called semantic units, or units of meaning. The inclusion of images or diagrams is also helpful.


Consider reviewing The Theory Underlying Concept Maps and How to Construct and Use Them.


This assignment helps students visualize concepts, establish meaningful connections between them, and organize concepts in a non-linear structure that provides a complete picture of students’ understanding of the specific ideas/themes/topics/concepts. Feel free to use the concept mapping tool of your choice, but make sure the assignment is submitted in a Word or PowerPoint format

Concepts are interlinked, and links briefly and accurately describe both simple and complex relationships;
Concept maps should use diagrams, illustrations, equations, etc., that have been introduced in the course. Teams can freely copy and paste these images from lecture notes with appropriate use of descriptions that note the relationship between concepts.
The concept map is contained in a single page, has multiple clear hierarchies, is well laid out, and provides a sufficient number of relevant examples with links;
A concept map is easy to read and free of spelling errors.

Concept Map Evaluation Metric

Breadth Map includes the essential concepts and describes the domain on multiple levels.
Interconnectivity All concepts are interlinked with several others.
Use of Descriptive Links Links briefly and accurately describe all relationships.
The efficiency of Links Each link type is distinct from all others clearly describes relationships; used consistently.
Layout Map is contained in a single page, has multiple clear hierarchies, is well laid out, and provides a sufficient number of relevant examples with links.
Development Over Time Final map shows the considerable cognitive progression from a base map and a significantly greater understanding of the domain.