Risk Management Training Programs

The Fundamentals of Foreign Exchange Risk and Derivatives

Réf: FOFERD-205

The Fundamentals of Foreign Exchange Risk and Derivatives

PUBLIC TRAINING

IN-HOUSE TRAINING

TAILOR-MADE TRAINING

IN-PERSON OR REMOTE CLASS

Duration: 2 days

➕ Remote learning activity

2050,00 € VAT Exempt ^(*)

📌 Reference: FOFERD-205

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^(*) As a training organization, Finance Tutoring benefits from a VAT exemption under Article 261-4-4° of the French General Tax Code (CGI).

Course Description

Fundamentals of Foreign Exchange Risk and Derivatives

Intensive 2-day training (14 hours) – Theoretical approach and practical case studies

The Fundamentals of Foreign Exchange Risk and Derivatives course provides you with the tools to master the mechanisms of the foreign exchange market, anticipate currency fluctuations, and implement effective FX risk hedging strategies.

◉ Current Context

In an environment of heightened currency volatility, this training addresses the critical challenges faced by professionals in:

Active FX risk management
Optimizing international operations
Mastering currency derivative instruments

Learning Content

1. FX Market

Actors and functioning of the Forex market
Exchange rate regimes and monetary policies
Exchange rate theories

2. FX Instruments

Spot market and quotation conventions
Forward contracts and rate calculations
Triangular arbitrage

3. Risk Management

Hedging strategies
Derivatives (swaps, options)
Sensitivity analysis

Learning Objectives

Master how the Forex market works
Differentiate between spot and forward
Apply exchange rate theories
Analyze the impact of economic policies

Calculate cross and forward rates
Design hedging strategies
Use currency derivatives
Assess counterparty risk

Target Audience

Treasurers

Fund Managers

FX Analysts

Risk Managers

Traders

◉ Available both in-person and online ◉ Training materials provided ◉ Certificate of completion

Training Program

The Fundamentals of Quantitative Finance

I. Foreign Exchange Market Ecosystem

Functions of the foreign exchange market
Various uses of the forex market
Size of the foreign exchange market
Main instruments:
- Spot
- Futures contracts
- Forward contracts
- Options
- FX swaps
Main participants:
- Banks
- Corporations
- Governments
- Funds
- Individuals

Quiz:

Match the given instrument types and participants with their corresponding definitions.

II. Different Exchange Rate Regimes

The Gold Standard
Floating exchange rate regime
Fixed exchange rate regime

Focus:

The European Union's single monetary policy.

III. Exchange Rates and Balance of Payments

The Marshall-Lerner condition
Price elasticity
Balance of payments and exchange rates
Current account balance and capital account balance
Contributions from economic theories:
- Covered and uncovered interest rate parity
- Purchasing power parity

Case Study:

Assess the impact of monetary and fiscal policy on the exchange rate of a fictitious country.

IV. Exchange Rate Quotation Conventions

General principles
Cross rates and triangular arbitrage
Forward rates

Case Studies:

Calculating a forward rate
Examining a triangular arbitrage scenario

V. Foreign Exchange Hedging

Using a forward contract
Using an option
Using a currency swap

Case Study:

Using a forward contract for hedging against exchange rate risk.