T
The Funky Gibbon
Member
I have a question regarding a swap question from the tutorial handout (Tutorial 3 Q14).
It involves OzCorp and Hola engaging in a currency swap. I thought the aim of a currency swap was to borrow money in different currencies at cheaper rates. The question talks about not exposing themselves to foreign currency risk. What are they talking about in the question here? Surely their foreign exchange risk depends upon what currency their revenues are in?
It involves OzCorp and Hola engaging in a currency swap. I thought the aim of a currency swap was to borrow money in different currencies at cheaper rates. The question talks about not exposing themselves to foreign currency risk. What are they talking about in the question here? Surely their foreign exchange risk depends upon what currency their revenues are in?