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Foreign Exchange Markets - Instruments, Risks and Derivatives | IIMBx on edX

2,561 views · Published 27 January 2017 · 3:14 · Indexed 21 October 2026

Channel: edX · 2017 · Education

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Delve into the fascinating world of Foreign Exchange Markets and Currency Derivatives as you learn the theories and practices that govern foreign exchange.

Take this course free on edX: https://www.edx.org/course/foreign-exchange-markets-instruments-iimbx-fc202x#!

ABOUT THIS COURSE
Thanks to the economic liberalization in several countries over the last few decades, the world has witnessed an exponential increase in the free flow of capital across countries, even more so in emerging economies. This has resulted in a globally interconnected ecosystem of banks and financial markets engaged in foreign exchange transactions that are continuously growing in volume, sophistication and complexity. That, in turn, has attracted a plethora of participants whose explicit intention is to either profit from or hedge against the heightened level of risks in the foreign exchange markets.  

This economics and finance course will unravel those complexities and help you gain a comprehensive understanding of foreign exchange markets: the underlying theories, the instruments traded and how the associated risks and potential adverse outcome are addressed/redressed using several techniques such as currency derivatives.

WHAT YOU'LL LEARN
Theories governing foreign exchange:
- Interest rate parity
- Purchasing power parity
- Nominal vs real exchange rates, etc.
- Types of transactions in the foreign exchange markets
How are exchange rates quoted and traded?
Participants in the foreign exchange market
Why and how do Central Banks intervene in the foreign exchange markets?
Nature and types of foreign exchange risks
- Transaction Exposure
- Operating Exposure
- Transaction Exposure
How are foreign exchange risks identified and managed?
Role of ‘currency derivatives’ in the foreign exchange markets, both for speculation and for hedging:
- Currency Futures
- Current Options
- Currency Swaps

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