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Fx risk hedging
1. FX RISK HEDGING AT
EADS
By:
14P027 Mithun Chandra Mohan
14P031 Pallavi Jha
14P056 Udit Upreti
14P058 Vishal Garg
2. Introduction
EADS: Leading global aerospace & defense
company with Airbus being its primary revenue
source
Why hedging:
Billed customers in dollars ; significant costs (76%
of sourcing) in Euros
Depreciation of dollar against Euro
Hedged future revenues with FX forward
contracts
Issue: Should EADS employ FX options to
hedge?