Introduction: Recent years’ globalization and expanding currency markets have increased the importance of financial managers.  A multinational company handles different currencies through export and imports, and is thus exposed to currency fluctuations. Awareness and assessment of risk management are issues more important not to ignore. Research question: How does the multinational company SCA indentify currency risk exposure, and how does the financial management relate to it? Purpose: The aim of this study is to get a deeper understanding of the currency risk management at a Swedish multinational company and how the individual manager identifies exposure. Furthermore, what means that exist for assessing the exposure and how the management choose to reduce the risk will be investigated. Method: This case study has a qualitative approach, and is mainly based on two unstructured interviews that have been conducted with the financial mangers of SCA. Findings: The authors found that SCA identifies different kinds of exposures related to currency risk. SCA is equipped with organizational strategies as well as practical methods for reducing the risk exposure and positioning themselves in line with company framework and policies. Conclusion:                   Currency risk management is a subject of great complexity since exposures interrelate and alternates with time and as global economy changes. A company could hold a framework of policies, strategies and instruments that will provide their financial managers with means for risk assessment and management. Ultimately the responsibility is still in the hand of the managers.

Purpose: The purpose of this thesis is to evaluate the currency risk management at Superfos and analyse how it can be improved.

Background: In an increasingly globalized environment, corporations perform transactions across borders on a day-to-day basis. As multinational corporations expand their businesses the number of currencies in their operations increases. The consequence of operating with several currencies is the risk associated with currency fluctuations. Sandvik AB is a worldwide corporation where activities are conducted through representation in more than 130 countries. Currency exposures are controlled through risk management where financial derivatives are applied to protect the corporation from potential losses caused by fluctuations. Sandvik AB recently implemented a hedging strategy entitled Layered Basket Option hedging. The strategy is a combination of a layered- and a basket option approach to maximize the effect of the hedge. There is a limited amount of previous research regarding Layered Basket Option hedging and Sandvik AB is the first corporation to actively practice this strategy. Purpose: The purpose is to investigate and provide information about how currency risk most effectively is hedged for the multinational corporation Sandvik AB. Furthermore, we want to evaluate if Sandvik’s recently implemented hedging strategy, Layered Basket Option hedging, is the best-suited strategy for them and if there are any improvements to be made. This thesis will further investigate the importance of currency hedging for multinational corporations, which are dependent on reporting to their stakeholders. Hopefully, this thesis will also facilitate the communication of Sandvik’s currency strategies throughout the organization and make it more comprehensible. Method: Exchange rates on daily basis for the period 2002-2012 were collected from Bank of Canada and Reuters database. The collected data was thereafter used as a basis to perform calculations to determine if Layered Basket Option hedging is the optimal solution for Sandvik AB. Conclusion: The results of this study highlight the benefits from applying a Layered Basket Option hedging strategy and the strategy succeeds to reduce the volatility caused by currency fluctuation. The results indicate that the combination of a layered- and a basket option approach successfully creates a suitable strategy for Sandvik AB. Furthermore, this thesis has recognized that there exists room for improvement by actively allocating currencies according to their weights and correlations to fully exploit the effects from the strategy.

Abstract The valuation of equity swap under the condition of risk neutral is similar to the forward interest rate swap with the same period. Therefore, its valuation formula is consistent to interest rate swap model in the traditional methods. But it is not the same as in pricing the cross-currency equity swap. The dymanic prices of foreign stock index and exchange rate, and the correlation coefficients between exchange rates and foreign assets also affect the swap rate. In this paper, we extend Chance and Rich(1998)¡¦s valuation formula of equity swaps, and apply Amin (1991)¡BAmin and Bodurtha(1995)¡BLin(1997)¡¦s dymanic prices of assets in discrete time period. To derive the risk neutral valuation formula of equity swap, it uses the method of transfer probability measure. This study finds the expected return of foreign stock index in the no arbitrage condition, in addition equal to foreign forward interest rate with the same period , must be add a correction term to reflect the exchange rate risk and the transfer of forward martingale measure. This paper also derives the pricing formula of equity swaptions¡Bcaps¡Bfloors¡Bvariable notional principal and blended equity swap. Finally, we find the volatility of foreign forward interest rate is the most important factor of pricing the swap rate from numerical simulation. And if the correlation of the volatility of exchange rate and foreign stock index¡Bthe correlation of the volatility of exchange rate and foreign forward interest rate are negative, the swap rate will be higher.

<p>The purpose of this thesis is to analyse if there are any changes in the inflow of Foreign Direct Investments before, during and after a currency crisis. The thesis is based on a theoretical framework and has an empirical part, which use a regression equation.</p><p>The theoretical framework presents a foundation of the incentives to mak FDI investments and the implications for a host country. Together with the possible link to the level of the real exchange rate in the host country, this thesis, based partly on previous paper written on the subject, presents a regression equation for an empirical analysis. The regression equation is based on a hypothesis about the changes in FDI inflow before, during and after the occurrence of a currency crisis in the host country.</p><p>The empirical analysis presents different results concerning the link between FDI and a currency crisis. The hypothesis stated in the thesis is that a currency crisis influences FDI inflows. This hypothesis is rejected. Moreover, a currency crisis can have both positive and negative effects on the inflow of FDI for the selected countries.</p><p>Results find further no similarities in regions or year of occurrence of the currency crises. The depth, length and structure of each currency crisis together with using the right definition of a currency crisis are two important factors relating to the outcomes in this study.</p>

<p><p> </p><p><strong>Purpose:</strong> The purpose of this thesis is to evaluate the currency risk management at Superfos and analyse how it can be improved.</p><p> </p></p><p> </p>

Thesis (Ph. D.)--University of California, San Diego, 2001. / Vita. Includes bibliographical references.

Thesis (Ph. D.)--University of Washington, 2003. / Vita. Includes bibliographical references (leaves 73-80).

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