Designing strategies for hedging

If you read the job description of just about any treasurer or CFO it will centre on being a strategic designer of matters financial; hedging, funding and interest cost reduction. In the days prior to the broad-based application of derivatives, pursuit of any one of the above would bring about (typically) uncontrollable consequences in the other two. For instance, if a company's main source of financing was floating rate bilateral loans from banks, it was exposed to the consequent eff…