Study Aids:
Click the Study Aids tab at the bottom of the book to access your Study Aids (usually practice quizzes and flash cards).
Study Pass:
Study Pass is our latest digital product that lets you take notes, highlight important sections of the text using different colors, create "tags" or labels to filter your notes and highlights, and print so you can study offline. Study Pass also includes interactive study aids, such as flash cards and quizzes.
Highlighting and Taking Notes:
If you've purchased the All Access Pass or Study Pass, in the online reader, click and drag your mouse to highlight text. When you do a small button appears – simply click on it! From there, you can select a highlight color, add notes, add tags, or any combination.
Printing:
If you've purchased the All Access Pass, you can print each chapter by clicking on the Downloads tab. If you have Study Pass, click on the print icon within Study View to print out your notes and highlighted sections.
Search:
To search, use the text box at the bottom of the book. Click a search result to be taken to that chapter or section of the book (note you may need to scroll down to get to the result).
View Full Student FAQs
6.6 Questions About Hedging, Derivatives, and Trading Risks
Increasingly, companies engage in hedging, derivative, and trading activities that involve substantial risks as part of their overall corporate strategy. Although hedging activities, with derivatives or other tools, may mitigate or resolve risky positions, hedges are rarely perfect. In addition, because of the sophisticated nature of hedging, derivative, and trading activities, the risk exposure of a company is difficult to define, complicating oversight of such activities by a board of directors.
At minimum, the board of a company engaging in hedging, derivative, or trading activities should ask the following questions:
- Where are the hedging, derivative, and trading risks embedded in the company, and who in the company is responsible for these activities?
- Does the board of directors understand the nature and purposes of the risk positions being taken?
- Are there risk limitations in place, and, if so, what are they and how effectively are they implemented?
- What is the risk to reward ratio that fits into the company’s strategic plan?
- Does the board of directors have a glossary to translate the explanations that it is likely to receive?