Global financial management:
Gespeichert in:
1. Verfasser: | |
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Format: | Buch |
Sprache: | English |
Veröffentlicht: |
Brisbane [u.a.]
Wiley
1996
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Schlagworte: | |
Online-Zugang: | Publisher description Table of Contents Inhaltsverzeichnis |
Beschreibung: | XVI, 400 S. Ill., graph. Darst. |
ISBN: | 0471578541 |
Internformat
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100 | 1 | |a O'Brien, Thomas J. |e Verfasser |4 aut | |
245 | 1 | 0 | |a Global financial management |c Thomas J. O'Brien |
264 | 1 | |a Brisbane [u.a.] |b Wiley |c 1996 | |
300 | |a XVI, 400 S. |b Ill., graph. Darst. | ||
336 | |b txt |2 rdacontent | ||
337 | |b n |2 rdamedia | ||
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650 | 7 | |a Internationale financiën |2 gtt | |
650 | 7 | |a Wisselkoersen |2 gtt | |
650 | 4 | |a International finance | |
650 | 4 | |a Foreign exchange | |
650 | 0 | 7 | |a Internationaler Kreditmarkt |0 (DE-588)4120506-6 |2 gnd |9 rswk-swf |
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adam_text | Global Markets 1
chapter 1
EXCHANGE RATES AND GLOBAL FINANCIAL MANAGEMENT 3
CURRENCY EXCHANGE AND EXCHANGE RATES 3
Currency Exchange 3
Exchange Rate Quotes 5
Transaction Costs 8
Cross Rates 9
Direct Terms Versus Indirect Terms 9
Exchange Rate Notation 10
Changes in Currency Values and Exchange Rate Quotes 10
Percentage Change in the Value of a Currency 14
Siegel s Paradox 15
THREE KEY TOPICS IN GLOBAL FINANCIAL MANAGEMENT 17
Global Corporate Financing Techniques 17
Measuring and Managing Corporate Currency Exposure 19
Capital Investment Decisions in the Global Context 22
Globalizing the Finance Function 24
SUMMARY 24
EXHIBITS
Currency Conversion 16
ix
X ¦ CONTENTS
Triangular Arbitrage 18 j
The Exxon Arbitrage 19
)
chapter2 ;
EXCHANGE RATES, GOODS PRICES, AND THE GLOBAL ECONOMY 28 j
THE EVOLUTION OF CURRENCY EXCHANGE 28 j
The Gold Standard and Exchange Rates 28
Official Devaluation and the Modified Gold Standard 30
The Bretton Woods System of Pegged Exchange Rates 32 ;
CURRENCY VALUATION AND GOODS MARKETS 34
The International Law of One Price 34
Misvaluation of Currencies and Trade Imbalances 35
Floating Rates and Purchasing Power Parity 38
Does the Purchasing Power Parity Condition Hold in Reality? 40
Central Banks and Speculators in the Floating Rate Market 43
EVOLUTION OF THE MODERN GLOBAL ECONOMY 45
Global Trade and Business Organization 45
Global Coordination 46
Trade Imbalances in the Modern Global Economy 50
SUMMARY 50
EXHIBIT
Argentina s Currency Board of the 1990s 48
chapter 3
GLOBAL FINANCE, INTEREST RATES, AND EXCHANGE RATES 55
OVERVIEW OF THE GLOBAL FINANCIAL MARKET 55
Traditional Trade Financing 56
International Banking 58
Global Financial Centers 60
The Basel Accord 60
THE EUROCURRENCY MARKET 61
LIBOR 64
Proceeds and Face Values 64
Arbitrage Between Eurocurrency Rates and National Rates 65
EXCHANGE RATES AND ASSET MARKETS 66
The Interest Parity Condition 67
Changes in Interest Rates in Asset Market Valuation 70
EQUILIBRIUM, DISEQUILIBRIUM, AND THE REAL WORLD 74
Real Interest Rates, Currency Values, and Trade Imbalances 74
Dynamic Scenarios 77
The U.S. Dollar in the Early 1980s 78
The Canadian Dollar in the Early 1990s 78
The British Pound in the Late 1980s 79
The Mexican Peso Crisis, 1994 1995 81
SUMMARY 82
I
CONTENTS ¦ H
EXHIBIT
Balance of Payments Accounting 80
appendix
THE INTERNATIONAL FISHER MODEL OF CURRENCY VALUATION 87
chapter 4
FORWARD EXCHANGE AND INTEREST RATES 93
FORWARD EXCHANGE 93
Forward Exchange Contracts 94
Long and Short Forward Exchange Positions 95
The Cash Settlement, Difference Check Approach 96
Forward Discounts and Premiums 98
Forward Exchange Contracts and Transaction Exposure 99
Hedging Philosophy 102
Foreign Exchange Futures Contracts 103
SYNTHETIC FORWARD EXCHANGE POSITIONS AND COVERED INTEREST
ARBITRAGE 104
Synthetic Forward Exchange Positions 104
The Synthetic Forward Exchange Rate 106
One Way Arbitrage 107
Covered Interest Arbitrage 108
Bank Activities 110
The Covered Interest Parity Condition 112
Are Forward Exchange Rates Good Predictors of Future Spot
Exchange Rates? 112
SUMMARY 115
EXHIBIT
Example oe Corporate Practice of Covered Interest Arbitrage 108
part II
Corporate Financing in the Global Market 119
chapter 5
GLOBAL DEBT FINANCING 121
EUROBONDS 122
Evolution of the Eurobond Market 122
Valuation of Straight Eurobonds 123
Zero Coupon Bonds 125
The Discount (or Strip) Yield Curve 128
Bond Valuation via Synthetics and One Way Arbitrage 128
Synthetic Zeros 130
FOREIGN CURRENCY DEBT 132
Currency Exposure of Foreign Currency Debt 132
Hedged Foreign Currency Debt as a Financing Alternative 135
Xil ¦ CONTENTS 1
I
INNOVATIONS OF THE EUROBOND MARKETS 140 |
Floating Rate Notes 140
Dual Currency Bonds and PERLS 141
Currency Indexed Bonds 144
SUMMARY 147
EXHIBITS
Issuance op Eurobonds 124
Pricing a New Bond Issue 134
appendix
AIBD VERSUS USBE YIELD QUOTATIONS 154
chapter 6
CURRENCY SWAPS 157
AN INTRODUCTION TO CURRENCY SWAPS 157
Fixed for Fixed Currency Swaps 158
Cross Currency Swaps 160
Off Market Swaps 163
Settlement of Currency Swaps with Difference Checks 163
FROM PARALLEL LOANS TO GLOBAL MARKETS 168
Parallel Loans and Back to Back Loans 168
The IBM World Bank Swap 171
Credit Risk Perceptions 173
Swap Driven Financing 174
Swap Innovations 176
MARK TO MARKET VALUATION OF CURRENCY SWAPS 177
SUMMARY 181
EXHIBIT
Currency Swaps and Tax Arbitrage 175
appendix
EXCHANGE MARKET CURRENCY SWAPS 186
chapter 7
TOPICS IN STRUCTURED GLOBAL FINANCING AND
THE USE OF OPTIONS 188
INTEREST RATE SWAPS AND COMMODITY SWAPS 189
Interest Rate Swaps 189
Commodity Swaps 191
CURRENCY OPTIONS 193
Calls and Puts 194
Option Writing 197
Puts 199
Options and Transaction Exposure to Foreign Exchange Risk 201
THE ROLE OF OPTIONS IN GLOBAL FINANCING 205
Currency Option Bonds 206
CONTENTS ¦ xIH
Oil Options in the Sonatrach Deal 209
Equivalence of Calls and Puts from Currency Perspective 211
SUMMARY 212
EXHIBITS
The Derivatives Debate: Are Derivatives Good or Bad? 197
Foreign Currency Exchange Warrants 206
Bull, and Bear Notes 208
appendix
EXOTIC OPTIONS 216
part III
Corporate Exposure to Foreicn Exchange Risk 221
chapter 8
OPERATING EXPOSURE TO EXCHANGE RATE RISK 223
THE MEASUREMENT OF OPERATING EXPOSURE 224
Operating Cash Flow Exposure 226
Operating Cash Flow Exposure, Operating Revenue Exposure, and Operating
Cost Exposure 228
THE ECONOMIC DETERMINANTS OF OPERATING EXPOSURE 230
Conversion Exposure 230
Price Exposure 232
Demand Exposure 235
Competitive Exposure 237
Indirect Exposure 239
Multimarket Exposures 239
Scenarios of Operating Exposure 240
SUMMARY 245
EXHIBIT
Measuring Exposure in the Real World 235
appendix
DYNAMIC NATURE OF OPERATING EXPOSURE 250
chapter 9
CAPITAL STRUCTURE AND EXPOSURE TO FOREIGN
EXCHANGE RISK 252
Roles of Foreign Currency Debt 252
Should Companies Manage Currency Exposure? 253
DEBT FINANCING, OPERATING CASH FLOW EXPOSURE,
AND NET CASH FLOW EXPOSURE 254
CASE I: Base Currency Debt Financing and the Financial Leverage Effect 256
Xiv ¦ CONTENTS
CASE II: Foreign Currency Debt Financing and Both the Currency Exposure
Hedging Effect and The Financial Leverage Effect 256
THE FRAMEWORK FOR EQUITY EXPOSURE 258
Measurement of Equity Exposure 258
Equity Value, Debt Value, and Total Value 259
Changes in Debt Value 260
Changes in Total Value and Operating Exposure 261
OPERATING EXPOSURE, DEBT FINANCING, AND EQUITY EXPOSURE 262
Financial Leverage 263
Debt Financing in the Currency of the Operating Exposure 265
Corporate Scenarios of Equity Exposure 268
Equity Exposure and Net Cash Flow Exposure 274
Exchange Rates, Interest Rates, and Capitalization Rates 277
SUMMARY 278
EXHIBIT
Metallgesellschaft: The Derivatives Debate Continued 270
appendix
DYNAMIC HEDGING AND CAPITAL STRUCTURE 282
chapter 10
ACCOUNTING ISSUES IN CORPORATE EXPOSURE
TO FOREIGN EXCHANGE RISK 285
ACCOUNTING AND FOREIGN CURRENCY TRANSACTIONS 286
The Economic Balance Sheet versus the Reported Balance Sheet 287
Reported Earnings 288
Economic Exposure, Accounting Exposure, and Market Perceptions 290
Accounting Issues and Derivatives 294
Currency Forwards and Swaps 294
Options 296
Currency Indexed Debt 297
Hedge Accounting 299
FOREIGN SUBSIDIARIES AND TRANSLATION EXPOSURE 301
Economic Value Not Equal to Book Value 304
Operating Exposure Not Equal to 1 307
SUMMARY 308
EXHIBITS
Kashima Oil 297
The Disney Notes 300
part IV
Global Capital Budgeting And Other Topics 313
chapter 11
INTRODUCTION TO CAPITAL BUDGETING IN
GLOBAL FINANCIAL MANAGEMENT 315
CONTENTS ¦ XV
CASH FLOW IDENTIFICATION IN GLOBAL CAPITAL BUDGETING 316
Review of the Weighted Average Cost of Capital 316
After Tax Operating Cash Flows 317
Financial Leverage of a Subsidiary 318
Taxes 322
Currency of Denomination in Global Capital Budgeting 324
GLOBAL ASSET PRICING THEORY 328
Review of the CAPM 328
The Global Asset Pricing Model 329
Returns in Global Asset Pricing Theory 331
The Market Portfolio in Global Asset Pricing Theory 332
The Currency Index in the GAPM 335
Applying the GAPM 338
SUMMARY 338
chapter 12
EXCHANGE RATE FORECASTING AND GLOBAL CAPITAL BUDGETING 343
ECONOMIC FUNDAMENTALS AND FORECASTING EXCHANGE RATES 344
Equilibration and the Law of One Price in the Goods Market 344
Inflation 345
Real Interest Rates and Economic Growth 346
Nominal Interest Rates and Portfolio Flows 346
EQUILIBRIUM FORMULAS FOR EXCHANGE RATE FORECASTING:
A COMPARISON 348
The Forward Exchange Rate and the Interest Parity Condition 348
Forecasting Exchange Rates with the GAPM 352
CASH FLOW CONVERSION IN CAPITAL BUDGETING 356
Currency Conversion and Growing Cash Flow Streams 356
Valuation with Perpetual Growth 359
Net Present Value 360
THE CURRENT SPOT EXCHANGE RATE AS A FORECAST 361
SUMMARY 363
EXHIBIT
The Dollar Depreciation Mystery 347
appendix
THE CORRELATION ISSUE 367
chapter 13
MULTICURRENCY EXPOSURE ISSUES 370
LINEAR MULTICURRENCY ISSUES 370
Currency Exposure and Regression Analysis 370
The Fundamentals of Linear Multicurrency Operating Exposure 372
Simultaneous Multicurrency Exposure: The Case of Finning 375
COMPOUND MULTICURRENCY EXPOSURE: WESTERN MINING COMPANY 377
Hi ¦ CONTENTS
Unilateral Change in the Value of the Australian Dollar 378
Unilateral Change in the Value of the U.S. Dollar 379
Compound Exposure 381
EQUITY EXPOSURE AND UNIVERSAL HEDGING 382
Hedge Ratios and Managing Multicurrency Equity Exposure with
Derivatives 383
Equity Exposure of Base Currency Owners in Multicurrency Equity 385
Exposure of Foreign Currency Equity 387
Exposure of Other Foreign Currency Owners to Exposure Currency 388
General Multicurrency Exposure Relationships 390
Universal Hedging 391
SUMMARY 393
EXHIBIT
The Compound Exposure of George Weston, Ltd. (Canada) 383
INDEX 397
|
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author | O'Brien, Thomas J. |
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discipline | Wirtschaftswissenschaften |
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spelling | O'Brien, Thomas J. Verfasser aut Global financial management Thomas J. O'Brien Brisbane [u.a.] Wiley 1996 XVI, 400 S. Ill., graph. Darst. txt rdacontent n rdamedia nc rdacarrier Internationale financiën gtt Wisselkoersen gtt International finance Foreign exchange Internationaler Kreditmarkt (DE-588)4120506-6 gnd rswk-swf Internationaler Kreditmarkt (DE-588)4120506-6 s DE-604 http://www.loc.gov/catdir/description/wiley033/95009585.html Publisher description http://www.loc.gov/catdir/toc/onix03/95009585.html Table of Contents HBZ Datenaustausch application/pdf http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=007420802&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA Inhaltsverzeichnis |
spellingShingle | O'Brien, Thomas J. Global financial management Internationale financiën gtt Wisselkoersen gtt International finance Foreign exchange Internationaler Kreditmarkt (DE-588)4120506-6 gnd |
subject_GND | (DE-588)4120506-6 |
title | Global financial management |
title_auth | Global financial management |
title_exact_search | Global financial management |
title_full | Global financial management Thomas J. O'Brien |
title_fullStr | Global financial management Thomas J. O'Brien |
title_full_unstemmed | Global financial management Thomas J. O'Brien |
title_short | Global financial management |
title_sort | global financial management |
topic | Internationale financiën gtt Wisselkoersen gtt International finance Foreign exchange Internationaler Kreditmarkt (DE-588)4120506-6 gnd |
topic_facet | Internationale financiën Wisselkoersen International finance Foreign exchange Internationaler Kreditmarkt |
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