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Benefit from a risk management strategy

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Reference no: EM133119234

Choose Intel (INTC) or Ford Motor Co. (F) or a company of your choosing which could benefit from a risk management strategy that uses futures. Please include the following items.

1. The nature and quantity of the risk and justification for risk management. For example, if you identify a company with a significant amount of currency exposure from international sales, try to quantify the amount in particular currencies. Or if you identify an airline that purchases jet fuel, try to quantify how much on an annual basis.

2. Options for Hedging and Contract Specifications - discuss alternatives considered, the amount of exposure hedged, rationale for the selected instruments, and number of contracts needed to hedge exposure. Also please discuss how you would implement the hedge, i.e. buy/sell one month contracts and roll them over, buy/sell longer term contracts, or a combination. Please consider if the strategy is viable given daily trading volumes in the contracts.

Reference no: EM133119234

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