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Assuming that you mean currency hedging - it is to make extra money! By pricing a transaction in one currency or the other, you are in essence gambling that you know which way the currency rate will go. Example: I want to buy $100 of Philippine mangoes, which buys 500 mangoes. The Dollar today is worth a bit over 54 Pesos (fractions ignored). If I make the deal in US dollars, I know my expense will be $100, and I will get 500 mangoes for them. If I want, I can lock in those values today. If I think the Philippine Peso will be going down in value, I can price those 500 mangoes at 5400 Pesos at close of transaction. If that time comes and the I can now get 65 Pesos for each US dollar, then divide 65 into 5400 means I spend only a bit over 83 US dollars for the same amount of mangoes. Realize that it is a gamble - guess wrong and it could also make those mangoes much more expensive!
What else can I help you with?
What is the purpose of a Money Market ETF?
Money Market ETFs have a very significant purpose. Money Market ETFs are a type of investment fund which many people use to trade like stocks for a profit.
What is the purpose of fidelity money market funds?
The purpose of a Fidelity money market fund is to generate revenue. The funds in a Fidelity money market fund are not guaranteed or insured. It is a type of fund that is very liquid, money is usually available by the next day.
What are cash trading advantages?
you get a certain profit as an agent , else you get the money from fluctuations in global market and respective currencies
Is dealer commercial paper money market or capital market?
Money Market
Shortage of liquidity in money market?
is the drain of excess liquidity from the money market
What is the purpose of a Money Market ETF?
Money Market ETFs have a very significant purpose. Money Market ETFs are a type of investment fund which many people use to trade like stocks for a profit.
What are the differences between foreign exchange market and equity market?
Foreign exchange (forex) is the global market of currency (money) , equity market (stock market) is the global market of shares (small pieces of large companies)
What is the purpose of fidelity money market funds?
The purpose of a Fidelity money market fund is to generate revenue. The funds in a Fidelity money market fund are not guaranteed or insured. It is a type of fund that is very liquid, money is usually available by the next day.
What is money and capital market?
What is capital market? Basically the capital market is a type of financial market, it includes the stocks and bonds market as well. But in general the capital market is the market for securities where either companies or the government can raise long term funds What is the money market? Basically the money market is the global financial market for short-term borrowing and lending and provides short term liquid funding for the global financial system. The average amount of time that companies borrow money in a money market is about thirteen months or lower
What are the Differences between domestic and global market?
A domestic market will usually have only one kind of money and one set of trade laws. The global market uses many kinds of money which fluctuate in their exchange value, and many sets of laws regarding international trade. The global market is much more complicated and on a larger scale than the domestic market.
What is the purpose of the website Money Central Market?
Money Central Market was a money exchanging website however it has been shutdown, and the domain name seized by the US government after being identified as fraudulent.
What best describes the purpose of market research?
To help producers make more money.
What is the purpose of global sourcing?
"Global sourcing is designed to reduce costs and increase efficiency by buying products and services all over the world. Sometimes it can save money, other times it reduces service quality and increases transportation costs so the saving are not significant."
How did the increase of trade in the global led to inflation?
As more products came on the market, wealth increased, and countries started making more money. As more money flooded the market, so it led to inflation.
What are cash trading advantages?
you get a certain profit as an agent , else you get the money from fluctuations in global market and respective currencies
Who were the risk takers in the new international trade market?
The entrepreneurs were the risk takers, as they invested the money in these global ventures.
How did the increase of trade in the global exchange led to inflation?
As more products came on the market, wealth increased, and countries started making more money. As more money flooded the market, so it led to inflation.
