coberturas de exposición en opciones de tipo de cambio

English translation: Hedging of exposure in foreign currency options

17:07 Mar 4, 2016
Spanish to English translations [PRO]
Bus/Financial - Finance (general) / DERIVATIVES OPERATIONS PURCHASE TRANSACTION
Spanish term or phrase: coberturas de exposición en opciones de tipo de cambio
Citibank-Colombia S.A. realiza todas las coberturas de exposición en opciones de tipo de cambio a través de Citibank N.A.
Emily Tell
United States
Local time: 00:43
English translation:Hedging of exposure in foreign currency options
Explanation:
Foreign exchange hedge - Wikipedia, the free encyclopedia
https://en.wikipedia.org/wiki/Foreign_exchange_hedge
A foreign exchange hedge transfers the foreign exchange risk from the trading or ... Therefore, a forward contract or option would create a financial asset for one entity ... The first is a cash flow hedge, defined as: “a hedge of the exposure to ...
[PDF]Managing Currency Risks with Options - CME Group
https://www.cmegroup.com/.../fx/.../ManagingCurrencyRisksWit...
options on currency futures have been growing very quickly in recent years. What is an ...... One may hedge a long currency exposure by selling futures, buying ...
Selected response from:

Andrew Bramhall
United Kingdom
Local time: 08:43
Grading comment
Thanks for your help!
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Summary of answers provided
4 +1exposure hedges in foreign exchange options
Robert Carter
5hedging of foreign exchange options
Francois Boye
4Hedging of exposure in foreign currency options
Andrew Bramhall
3exchange *rate* options exposure hedging
Adrian MM. (X)


  

Answers


5 mins   confidence: Answerer confidence 4/5Answerer confidence 4/5
Hedging of exposure in foreign currency options


Explanation:
Foreign exchange hedge - Wikipedia, the free encyclopedia
https://en.wikipedia.org/wiki/Foreign_exchange_hedge
A foreign exchange hedge transfers the foreign exchange risk from the trading or ... Therefore, a forward contract or option would create a financial asset for one entity ... The first is a cash flow hedge, defined as: “a hedge of the exposure to ...
[PDF]Managing Currency Risks with Options - CME Group
https://www.cmegroup.com/.../fx/.../ManagingCurrencyRisksWit...
options on currency futures have been growing very quickly in recent years. What is an ...... One may hedge a long currency exposure by selling futures, buying ...

Andrew Bramhall
United Kingdom
Local time: 08:43
Native speaker of: Native in EnglishEnglish
PRO pts in category: 60
Grading comment
Thanks for your help!
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8 mins   confidence: Answerer confidence 4/5Answerer confidence 4/5 peer agreement (net): +1
exposure hedges in foreign exchange options


Explanation:
cobertura > hedging/hedge
exposición > exposure (i.e. to risk)
https://en.wikipedia.org/wiki/Foreign_exchange_hedge

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Note added at 13 mins (2016-03-04 17:20:42 GMT)
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16.3 Exposure Hedges
The next sections will examine the above CVA components in more detail and from a practical perspective. The following assumptions will be used unless otherwise stated:

https://www.safaribooksonline.com/library/view/counterparty-...

In finance, a foreign exchange option (commonly shortened to just FX option or currency option) is a derivative financial instrument that gives the right but not the obligation to exchange money denominated in one currency into another currency at a pre-agreed exchange rate on a specified date.
https://en.wikipedia.org/wiki/Foreign_exchange_option

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Note added at 1 hr (2016-03-04 18:11:16 GMT)
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Actually, looking at the phrase you have there, I can't tell whether it means "All of Citibank-Colombia's foreign-exchange option hedges are done through Citibank SA" or "All of Citibank-Colombia's hedging is done through Citibank SA in foreign exchange options". I suppose the former is the safest bet.

Robert Carter
Mexico
Local time: 01:43
Works in field
Native speaker of: Native in EnglishEnglish
PRO pts in category: 288

Peer comments on this answer (and responses from the answerer)
agree  philgoddard: I must admit I've never heard of exposure hedges. Is there any other kind?
34 mins
  -> Yes, I admit, I don't think exposure is strictly necessary here.
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1 hr   confidence: Answerer confidence 5/5
hedging of foreign exchange options


Explanation:

http://finance.zacks.com/hedge-call-options-3543.html

https://en.wikipedia.org/wiki/Foreign_exchange_option



Francois Boye
United States
Local time: 03:43
Specializes in field
Native speaker of: Native in FrenchFrench
PRO pts in category: 335
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2 hrs   confidence: Answerer confidence 3/5Answerer confidence 3/5
exchange *rate* options exposure hedging


Explanation:
NB the other answers hitherto have ducked the 'tipo de cambio' part.

Exposure of course, again, is risk exposure and nowt to do with photography or the criminal offence of indecent exposure/exhibitionism on public transport or, in London, old men in macs hiding in Lincoln's Inn 'hedges' and that is not pertinent to the question.


Example sentence(s):
  • If it has written an American-style option, which can be exercised at any time prior to maturity, the bank could hedge its exposure by buying foreign currency.

    Reference: http://https://books.google.at/books?isbn=1557752907
Adrian MM. (X)
Local time: 09:43
Specializes in field
Native speaker of: Native in EnglishEnglish
PRO pts in category: 87
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