Ivey Publishing
IFC Manufacturing - Foreign Exchange Hedging
Product Number:
9A99N010
Publication Date:
06/08/1999
Revised Date:
01/21/2010
Length:
19 pages (7 pages of text)
Product Type:
Case (Gen Exp)
Source:
Ivey
IFC Manufacturing, an automobile parts producer, was attempting to raise capital to fund expansion in Mexico. In order to secure financing, the creditor banks required an assessment of the IFC's financial risk management apparatus. IFC had exposures to foreign exchange and interest rates. IFC had grown aggressively by acquiring firms on both sides of the Canadian-U.S. border, funding these purchases in U.S. dollars. The case allows for discussion of a number of issues, including: internal controls (the Group of Thirty recommendations for good derivatives practices), risk measurement and management. Data is provided which allows students to qualify translational and transactional risk exposures. Information is also provided allowing students to evaluate IFC's portfolio of hedging instruments which includes plain vanilla options, single barrier options, double barrier options and average rate options.
Issues:
Disciplines:
Finance
Industries:
Manufacturing
Setting:
Canada, Medium, 1998
Intended Audience:
Undergraduate/MBA
Price:
$4.25 CAD / $4.25 USD Printed Copy
$3.75 CAD / $3.75 USD Permissions
$3.75 CAD / $3.75 USD Digital Download
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