If the maturity of a currency position and the maturity of the hedging instrument are the same,then:
A)all risk is eliminated.
B)cash inflows and cash outflows are offsetting.
C)maturities match.
D)hedging is not necessary.

Question

Quizplus · Accepted Answer

Matching the maturity of a currency position with the maturity of the hedging instrument ensures that the timing of cash flows from the hedging activity aligns with the timing of the underlying exposure, referred to as maturities match.

If the Maturity of a Currency Position and the Maturity