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Many MNEs Have Established Rigid Transaction Exposure Risk Management Policies

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Many MNEs have established rigid transaction exposure risk management policies which mandate proportional hedging (a percentage of existing transaction exposures). Explain the pros and cons of proportional hedging.

Many MNEs have established rigid transaction exposure risk management policies which mandate proportional hedging (a percentage of existing transaction exposures). Explain the pros and cons of proportional hedging.

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First of all, hedging is expensive. Thes...

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