How does legal system impose risk on a derivatives dealer

Reference no: EM131318698

Explain how closeout netting reduces the credit risk for two firms engaged in several derivatives contracts ? How does the legal system impose risk on a derivatives dealer?

Consider a firm that has assets that generate cash but which cannot be easily valued on a regular basis. What are the difficulties faced by this firm when using VAR and what alternatives would it have?

Reference no: EM131318698

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