HW 5.docx Assignment 5 – Currency risk You may do this assignment alone or with one other person. For each of your answers, be as specific as possible about all transactions and amounts involved. All interest rates are stated as annual rates. Part 1 Transaction risk 1 (10 points) a. Select a foreign currency b. Find the spot exchange rate for that currency c. Select an amount between 150 million and 200 million d. Select a number of months between 3 and 9 e. Select either payable or receivable. If you select payable, for the rest of the questions in this part of the assignment, assume a US firm is required to make a payment of the number selected in part c of the foreign currency from part a at the time selected in part d. If you select receivable, assume a US firm expects to receive a payment of the number of units selected in part c of the foreign currency from part a at the time selected in part d. e. Describe the future payment (in $) from the above assumptions if the exchange rate remains the same as it is today. 2. (10 points) Explain how the firm can use leading or lagging to reduce the exchange rate risk created by this payment. 3. (20 points) Assume the US interest rate is 2% and the foreign interest rate is 5%, how can the firm hedge the transaction risk associated with the payment using a money market hedge? 4 (20 points) a. How can the firm hedge the transaction risk associated with the payment using a forward market hedge? b. If the forward price is 1% lower than the spot exchange rate (from 1b) and the actual exchange rate on the date the payment is due is 1% higher than the spot exchange rate, what will the dollar value of the amount the firm pays or receives on the due date be? c. If the forward price is 2% higher than the spot exchange rate (from 1b) and the actual exchange rate on the date the payment is due is 1% higher than the spot exchange rate, what will the dollar value of the amount the firm pays or receives on the due date be? 5 (20 points) a. How can the firm hedge the risk associated with the payment using a foreign currency option? b. If the option’s strike price is equal to the spot exchange rate (from 1b) and the actual exchange rate on the payment is due is 2% lower than the spot market price, will the firm exercise the options and what will the dollar amount the firm pays or receives on the due date be? c. If the option’s strike price is equal to the spot exchange rate (from 1b) and the actual exchange rate on the payment is due is 2% higher than the spot market price, will the firm exercise the options and what will the dollar amount the firm pays or receives on the due date be? 6. (10 points) How could the firm hedge the transaction risk associated with this payment by exposure netting or funds adjustment? Part 2 Economic risk 1. (10 points) Obtain weekly stock prices for the last five years for a US company and a foreign company of your choice. 2. (10 points) Obtain exchange rates for three dif ...

1. HW 5.docx
Assignment 5 – Currency risk
You may do this assignment alone or with one other person. For
each of your answers, be as specific as possible about all
transactions and amounts involved.
All interest rates are stated as annual rates.
Part 1 Transaction risk
1 (10 points)
a. Select a foreign currency
b. Find the spot exchange rate for that currency
c. Select an amount between 150 million and 200 million
d. Select a number of months between 3 and 9
e. Select either payable or receivable. If you select payable, for
the rest of the questions in this part of the assignment, assume a
US firm is required to make a payment of the number selected
in part c of the foreign currency from part a at the time selected
in part d. If you select receivable, assume a US firm expects to
receive a payment of the number of units selected in part c of
the foreign currency from part a at the time selected in part d.
e. Describe the future payment (in $) from the above
assumptions if the exchange rate remains the same as it is
today.
2. (10 points) Explain how the firm can use leading or lagging
to reduce the exchange rate risk created by this payment.
3. (20 points) Assume the US interest rate is 2% and the foreign
interest rate is 5%, how can the firm hedge the transaction risk
associated with the payment using a money market hedge?

2. 4 (20 points)
a. How can the firm hedge the transaction risk associated with
the payment using a forward market hedge?
b. If the forward price is 1% lower than the spot exchange rate
(from 1b) and the actual exchange rate on the date the payment
is due is 1% higher than the spot exchange rate, what will the
dollar value of the amount the firm pays or receives on the due
date be?
c. If the forward price is 2% higher than the spot exchange rate
(from 1b) and the actual exchange rate on the date the payment
is due is 1% higher than the spot exchange rate, what will the
dollar value of the amount the firm pays or receives on the due
date be?
5 (20 points)
a. How can the firm hedge the risk associated with the payment
using a foreign currency option?
b. If the option’s strike price is equal to the spot exchange rate
(from 1b) and the actual exchange rate on the payment is due is
2% lower than the spot market price, will the firm exercise the
options and what will the dollar amount the firm pays or
receives on the due date be?
c. If the option’s strike price is equal to the spot exchange rate
(from 1b) and the actual exchange rate on the payment is due is
2% higher than the spot market price, will the firm exercise the
options and what will the dollar amount the firm pays or
receives on the due date be?
6. (10 points) How could the firm hedge the transaction risk
associated with this payment by exposure netting or funds
adjustment?
Part 2 Economic risk
1. (10 points) Obtain weekly stock prices for the last five years
for a US company and a foreign company of your choice.

3. 2. (10 points) Obtain exchange rates for three different foreign
currencies, one of which must be the British pound or the Euro,
and the other the Japanese yen, the Mexican peso, the Canadian
dollar, and the third the currency of the country where the
foreign firm is located for the same dates as the stock prices in
question 1. (If the foreign firm is located in the UK or the euro
area, use the other of the two as your first currency. If it is
located in Japan, Mexico or Canada, use one of the other two
currencies as your second currency.)
3. (10 points) Calculate weekly returns on each stock and
weekly percentage changes in the exchange rate for each
currency.
4. (60 points) Determine the economic risk of the US stock and
the foreign stock with respect to each of the foreign currencies.
(You will have a separate regression for company and currency;
a total of six regressions.)
For each company and currency:
(a) Describe the magnitude of the stock’s risk relative to the
currency (e.g., “a 1% increase in the value of the currency is
associated with a ___% change in the value of the stock”).
(b) Indicate whether the stock price increases or decreases as
the value of the foreign currency increases.
(c) Determine whether the company’s risk relative to that
currency is statistically significant.
(d) Indicate what portion of the stock return volatility canbe
eliminated if the currency risk were hedged perfectly.
forex_assignment.docx

4. Part 1
1
a) Currency selected = UK Pound
b) Spot Rate = 0.70 Pound / $
c) Selected amount = 150,000,000 Pounds
d) Selected Months = 3 Months
f) Payment in pounds to be received i.e. US firm has a foreign
currency receivable exposure in 3 months.
g)
Payment Received Pounds
150,000,000.00
Exchange Rate (Pound/Dollar)
0.70
Payment Received Dollars
214,285,714.29
2)
Leading and lagging refers to an alteration made to normal
foreign payment receipt and payments. More specifically an
expected increase in exchange rates make it likely that the
company making the payment will speed up payments whereas
an expected decrease will lead to a slowdown of payments.
Since the company is receiving the payments it will do the
opposite when utilizing leads and lags to deal with exchange
rate risk.
3) The risk can be hedged by borrowing the present value of the
foreign currency receivable and converting it to dollars at the
spot rate of 0.7 pounds per dollar. The funds are then invested
at the US interest rate of 2%. After 3 months when foreign
currency is received the funds are used to repay the loan in
foreign currency.
Dollar interest rate
2.00%
Pound interest rate
5.00%
Disc Rate (Pound)

5. 101.23%
Present Value of FC
148,181,482.11
Converted to $
211,687,831.59
In 3 Months loan repaid
150,000,000.00
4)
a) Since the firm has a long exposure in 3 months in foreign
currency. The exchange rate risk can be hedged by going short
on a 3 month forward contract at the forward rate. This will
effectively lock in an exchange rate at the forward rate.
b)
3 month forward rate
0.69
Payment Received Pounds
150,000,000.00
Payment Received Dollars
216,450,216.45
c)
3 month forward rate
0.71
Payment Received Pounds
150,000,000.00
Payment Received Dollars
210,084,033.61
5)
a) The risk can be mitigated by entering into a currency put
option to sell the foreign currency at an exercise price. The use
of options however will give the firm the option not to exercise
if the actual exchange price is higher than the put price.
b)

6. Strike Price
0.7
Actual Spot Rate
0.69
Pounds received
150,000,000.00
Dollar received using option
214,285,714.29
Dollar received not using option
218,658,892.13
Option Exercised
Yes
C)
Strike Price
0.7
Actual Spot Rate
0.71
Pounds received
150,000,000.00
Dollar received using option
214,285,714.29
Dollar received not using option
210,084,033.61
Option Exercised
No
6) Netting could be used to hedge the risk if the firm also had a
payable in the foreign currency. The two payments could then
be used to net each other out hence reducing the overall
exposure of the firm to the foreign currency. More specifically
losses on receivable would be offset by gains on payable and
vice versa.
Part 2
1) Companies selected Verizon (US) and Telenor (Foreign).

7. Price Information available in excel file.
2) Parts 2-4. On excel sheet attached.
forex_workings.xlsx
Sheet11)Payment Received Pounds150,000,000.00Exchange
Rate (Pound/Dollar)0.70Payment Received
Dollars214,285,714.293)Dollar interest rate2.00%Pound interest
rate5.00%Disc Rate (Pound)101.23%Present Value of
FC148,181,482.11Converted to $211,687,831.59In 3 Months
loan repayed150,000,000.004b)3 month forward
rate0.69Payment Received Pounds150,000,000.00Payment
Received Dollars216,450,216.454c)3 month forward
rate0.71Payment Received Pounds150,000,000.00Payment
Received Dollars210,084,033.615b)Strike Price0.7Actual Spot
Rate0.69Pounds recievd 150,000,000.00Dollar received using
option214,285,714.29Dollar received not using
option218,658,892.13Option ExercisedYesStrike Price0.7Actual
Spot Rate0.71Pounds recievd 150,000,000.00Dollar received
using option214,285,714.29Dollar received not using
option210,084,033.61Option ExercisedNo
forex_workings_part_2.xlsx
Solution
s 2-4VerizonTelenor% ReturnDateVerizonTelenorBritish Pound
to US DollarUS Dollar to Norwegian KroneUS Dollar to

8. Mexican PesoChange in Value% ReturnChange in Value%
ReturnBritish Pound to US DollarUS Dollar to Norwegian
KroneUS Dollar to Mexican Peso13-Jun-
1653.78125.50.708.2718.841.112.11%-3.02-
2.35%1.82%1.18%0.89%6-Jun-
1652.67128.520.698.1818.681.753.44%-4.18-3.15%0.28%-
2.35%1.18%31-May-1650.92132.70.698.3718.460.30.59%-4.28-
3.12%-0.08%0.25%-0.32%23-May-
1650.62136.980.698.3518.520.961.93%0.780.57%-
0.50%2.26%1.17%16-May-1649.66136.20.698.1718.31-1.28-
2.51%4.283.24%0.00%-0.62%0.58%9-May-
1650.94131.920.698.2218.20-0.18-
0.35%5.894.67%1.78%2.50%5.84%2-May-
1651.12126.030.688.0217.200.180.35%-4.91-3.75%-1.25%-
2.25%-2.13%25-Apr-
1650.94130.940.698.2017.570.390.77%3.682.89%-1.46%-
0.16%0.79%18-Apr-1650.55127.260.708.2217.43-0.8-1.56%-
1.04-0.81%-0.31%0.22%-1.31%11-Apr-
1651.35128.30.708.2017.66-0.83-1.59%5.394.39%0.24%-
1.59%1.01%4-Apr-1652.18122.910.708.3317.49-1.27-2.38%-
1.61-1.29%-0.04%-1.21%0.24%28-Mar-
1653.45124.520.708.4317.440.450.85%-4.16-
3.23%0.77%0.23%0.12%21-Mar-
1653128.680.708.4117.420.320.61%0.10.08%-0.61%-0.74%-
1.83%14-Mar-1652.68128.580.708.4817.750.71.35%-1.32-

9. 1.02%-0.15%-0.35%0.04%7-Mar-
1651.98129.90.708.5117.740.711.38%00.00%-2.33%-2.11%-
2.22%29-Feb-
1651.27129.90.728.6918.150.781.54%8.416.92%1.59%0.94%0.3
0%22-Feb-
1650.49121.490.718.6118.090.160.32%4.253.63%1.09%-0.24%-
4.19%16-Feb-
1650.33117.240.708.6318.880.741.49%4.634.11%0.92%0.46%1.
20%8-Feb-1649.59112.610.698.5918.66-0.85-1.69%-16.54-
12.81%-0.06%-1.09%2.25%1-Feb-
1650.44129.150.698.6818.250.992.00%-3.87-2.91%-1.28%-
0.85%-2.02%25-Jan-1649.45133.020.708.7618.622.96.23%-
0.95-0.71%-0.44%-0.62%1.97%19-Jan-
1646.55133.970.718.8118.262.585.87%6.435.04%2.57%-
1.45%2.04%11-Jan-1643.97127.540.698.9417.90-0.39-0.88%-
11.43-8.22%1.16%0.67%3.50%4-Jan-
1644.36138.970.688.8817.29-0.82-1.81%-1.14-
0.81%1.21%2.22%0.41%28-Dec-1545.18140.110.678.6917.22-
0.48-1.05%1.040.75%0.03%-0.95%0.44%21-Dec-
1545.66139.070.678.7717.151.122.51%1.71.24%1.77%1.33%-
0.97%14-Dec-1544.54137.370.668.6617.320.731.67%-3.02-
2.15%-0.72%-0.10%2.54%7-Dec-1543.81140.390.668.6716.89-
0.87-1.95%1.81.30%0.05%-0.24%1.91%30-Nov-
1544.68138.590.668.6916.570.471.06%-6.71-
4.62%0.46%0.46%0.05%23-Nov-1544.21145.30.668.6516.56-

10. 0.16-0.36%-0.57-0.39%0.50%-0.61%-1.24%16-Nov-
1544.37145.870.668.7016.771.132.61%6.424.60%-
0.54%0.52%0.02%9-Nov-1543.24139.450.668.6616.77-1.51-
3.37%-7.55-5.14%2.00%1.96%1.98%2-Nov-
1544.751470.658.4916.44-1.08-2.36%-4.44-2.93%-
0.44%1.96%-0.52%26-Oct-
1545.83151.440.658.3316.530.711.57%-10.77-
6.64%0.74%2.39%0.20%19-Oct-
1545.12162.210.658.1316.501.423.25%6.74.31%-
0.80%0.44%0.16%12-Oct-
1543.7155.510.658.1016.470.531.23%0.850.55%-1.28%-3.64%-
1.79%5-Oct-
1543.17154.660.668.4016.771.834.43%7.945.41%0.12%-1.56%-
1.84%28-Sep-1541.34146.720.668.5417.08-1.33-3.12%-6.52-
4.25%2.29%3.81%2.56%21-Sep-1542.67153.240.648.2216.66-
0.34-0.79%0.470.31%-0.58%0.28%-0.49%14-Sep-
1543.01152.770.658.2016.74-1.12-2.54%0.190.12%-0.18%-
0.38%-0.53%8-Sep-1544.13152.580.658.2316.830.882.03%-
2.08-1.34%-0.29%-0.46%0.50%31-Aug-
1543.25154.660.658.2716.75-1.21-2.72%-0.56-
0.36%2.63%0.48%-2.61%24-Aug-1544.46155.220.638.2317.19-
0.03-0.07%-0.19-0.12%-1.08%0.23%4.63%17-Aug-
1544.49155.410.648.2116.43-1.34-2.92%-2.65-
1.68%0.01%0.16%1.67%10-Aug-
1545.83158.060.648.2016.161.092.44%-9.73-5.80%0.02%-

11. 0.61%-0.11%3-Aug-1544.74167.790.648.2516.18-0.41-0.91%-
1.51-0.89%-0.18%0.90%-0.71%27-Jul-
1545.15169.30.648.1716.300.721.62%-1.7-0.99%0.03%-
0.63%1.82%20-Jul-1544.431710.648.2316.01-1.49-3.24%-2.65-
1.53%-0.49%1.85%1.91%13-Jul-
1545.92173.650.658.0815.710.571.26%4.922.92%0.74%-0.08%-
0.04%6-Jul-
1545.35168.730.648.0815.710.330.73%6.043.71%0.79%2.63%0.
19%29-Jun-1545.02162.690.647.8815.68-0.4-0.88%-3.11-
1.88%0.62%1.73%2.22%22-Jun-
1545.42165.80.637.7415.340.150.33%2.551.56%-1.43%-0.18%-
0.59%15-Jun-1545.27163.250.647.7615.430.20.44%-1.33-
0.81%-1.65%-0.85%-1.27%8-Jun-
1545.07164.580.657.8215.630.020.04%-2.55-1.53%-0.91%-
1.72%0.99%1-Jun-1545.05167.130.667.9615.48-2.1-
4.45%0.660.40%1.26%2.74%1.25%26-May-
1547.15166.470.657.7515.29-0.17-
0.36%0.860.52%1.72%4.52%1.19%18-May-
1547.32165.610.647.4115.11-0.17-0.36%0.640.39%-0.51%-
2.06%-1.56%11-May-1547.49164.970.647.5715.35-0.33-0.69%-
0.93-0.56%-2.95%-0.32%-0.71%4-May-
1547.82165.90.667.5915.46-0.26-0.54%8.425.35%0.72%-
1.87%0.62%27-Apr-1548.08157.480.667.7415.360.360.75%-
3.24-2.02%-3.65%-4.33%-0.15%20-Apr-
1547.72160.720.688.0915.391.082.32%5.553.58%1.49%1.78%3.

12. 23%13-Apr-1546.64155.170.677.9414.91-0.3-0.64%-1.85-
1.18%-0.54%-0.89%-2.33%6-Apr-
1546.94157.020.688.0215.260.280.60%6.474.30%0.96%1.65%2.
25%30-Mar-1546.66150.550.677.8914.930.861.88%-0.18-
0.12%-0.84%-4.61%-3.17%23-Mar-1545.8150.730.678.2715.41-
0.94-2.01%2.962.00%1.88%4.06%-0.53%16-Mar-
1546.74147.770.667.9415.500.681.48%0.640.43%1.69%3.20%3.
11%9-Mar-
1546.06147.130.657.7015.030.521.14%5.093.58%0.61%0.98%-
0.45%2-Mar-1545.54142.040.657.6215.10-1.1-2.36%-0.18-
0.13%-0.64%1.31%1.19%23-Feb-
1546.64142.220.657.5214.920.461.00%-0.74-0.52%-0.90%-
0.99%0.66%17-Feb-1546.18142.960.667.6014.82-0.33-
0.71%0.740.52%-1.24%-0.69%-0.28%9-Feb-
1546.51142.220.677.6514.86-0.01-0.02%-10.18-6.68%0.39%-
1.79%1.94%2-Feb-1546.52152.40.667.7914.583.417.91%-1.38-
0.90%0.40%1.37%-0.55%26-Jan-1543.11153.780.667.6914.66-
1.36-3.06%-3.8-2.41%0.16%-0.74%0.04%20-Jan-
1544.47157.580.667.7414.65-0.79-
1.75%7.865.25%0.58%1.40%-1.95%12-Jan-
1545.26149.720.667.6414.941.162.63%4.172.86%1.68%2.84%1.
37%5-Jan-
1544.1145.550.647.4314.740.330.75%4.83.41%0.41%-0.16%-
0.09%29-Dec-1443.77140.750.647.4414.76-0.84-1.88%-1.47-
1.03%0.42%-0.21%0.02%22-Dec-

13. 1444.61142.220.647.4514.750.781.78%-2.13-
1.48%0.05%4.80%2.21%15-Dec-
1443.83144.350.647.1114.431.353.18%7.955.83%0.52%1.20%2.
34%8-Dec-1442.48136.40.647.0314.10-2.83-6.25%-6.19-4.34%-
0.22%3.37%3.24%1-Dec-1445.31142.590.646.8013.66-1.84-
3.90%5.644.12%-0.39%0.17%0.56%24-Nov-
1447.15136.950.646.7913.580.350.75%-6.01-4.20%1.36%-
0.39%-0.14%17-Nov-1446.8142.960.636.8113.60-1.2-2.50%-
1.76-1.22%0.81%0.21%-0.03%10-Nov-
1448144.720.636.8013.610.591.24%6.564.75%0.92%3.22%0.41
%3-Nov-1447.41138.160.626.5913.550.571.22%-2.03-
1.45%0.22%0.40%-0.01%27-Oct-
1446.84140.190.626.5613.551.383.04%8.236.24%-
0.53%1.25%0.78%20-Oct-
1445.46131.960.626.4813.450.651.45%8.146.57%0.06%0.06%0.
33%13-Oct-1444.81123.820.626.4813.40-0.81-
1.78%0.550.45%1.00%0.50%-0.66%6-Oct-
1445.62123.270.626.4413.49-0.2-0.44%-3.6-
2.84%0.75%1.53%1.64%29-Sep-1445.82126.870.616.3513.28-
0.06-0.13%-5.37-4.06%-0.82%-0.38%0.24%22-Sep-
1445.88132.240.626.3713.25-0.53-1.14%-1.57-1.17%-
0.83%1.44%1.55%15-Sep-
1446.41133.810.626.2813.041.84.03%-1.02-0.76%2.35%1.49%-
0.44%8-Sep-1444.61134.830.616.1913.10-1.42-
3.08%1.851.39%0.58%0.07%-0.33%2-Sep-

14. 1446.03132.980.606.1813.140.110.24%1.571.19%0.94%0.71%0.
69%25-Aug-
1445.92131.410.606.1413.051.092.43%0.650.50%0.38%-1.46%-
1.52%18-Aug-1444.83130.760.606.2313.26-0.15-0.33%-0.37-
0.28%0.45%-0.57%0.41%11-Aug-
1444.98131.130.596.2713.200.090.20%2.962.31%0.71%0.75%1.
93%4-Aug-1444.89128.170.596.2212.95-1.04-2.26%-4.35-
3.28%0.54%0.64%-0.13%28-Jul-1445.93132.520.596.1812.97-
1.34-2.83%-4.8-3.50%0.09%0.09%-0.14%21-Jul-
1447.27137.320.596.1812.990.491.05%7.215.54%0.26%-
0.19%0.12%14-Jul-
1446.78130.110.586.1912.970.40.86%2.131.66%-0.18%0.97%-
0.03%7-Jul-1446.38127.980.586.1312.981.052.32%-1.76-
1.36%-0.43%-0.02%-0.05%30-Jun-
1445.33129.740.596.1312.980.350.78%-0.19-0.15%-
0.31%2.22%-0.15%23-Jun-1444.98129.930.596.0013.00-0.06-
0.13%-1.85-1.40%-1.03%0.78%0.62%16-Jun-
1445.04131.780.605.9512.920.190.42%-0.74-0.56%-0.34%-
0.50%0.50%9-Jun-1444.85132.520.605.9812.86-0.22-0.49%-
3.88-2.84%0.39%0.37%-0.12%2-Jun-
1445.07136.40.595.9612.87-0.49-1.08%5.364.09%0.01%0.37%-
0.23%27-May-1445.56131.040.595.9412.900.20.44%-0.27-
0.21%0.34%0.45%-0.42%19-May-
1445.36131.310.595.9112.960.611.36%-0.93-0.70%-0.02%-
0.44%-0.29%12-May-

15. 1444.75132.240.595.9412.990.541.22%4.253.32%-0.34%-
1.24%-1.07%5-May-
1444.21127.990.596.0113.131.242.89%3.793.05%-
0.11%0.36%0.63%28-Apr-
1442.97124.20.605.9913.051.082.58%3.963.29%-0.38%0.66%-
0.13%21-Apr-1441.89120.240.605.9513.07-1.52-
3.50%7.586.73%-0.70%-0.83%0.41%14-Apr-
1443.41112.660.606.0013.010.481.12%-1.41-1.24%0.33%-
0.09%-0.40%7-Apr-1442.93114.070.606.0013.07-0.4-0.92%-
3.08-2.63%-1.00%-0.78%-1.23%31-Mar-
1443.33117.150.616.0513.230.561.31%0.080.07%0.86%1.34%-
0.01%24-Mar-1442.77117.070.605.9713.230.461.09%3.73.26%-
0.01%-0.21%0.21%17-Mar-
1442.31113.370.605.9813.200.751.80%3.793.46%0.16%-0.50%-
0.88%10-Mar-1441.56109.580.606.0113.32-0.96-2.26%-2.73-
2.43%-0.05%-0.99%0.51%3-Mar-1442.52112.310.606.0713.25-
0.39-0.91%-4.49-3.84%0.17%-0.13%0.41%24-Feb-
1442.91116.80.606.0813.200.280.66%-0.18-0.15%-1.67%-
1.57%-0.62%18-Feb-
1442.63116.980.616.1813.280.681.62%3.262.87%-0.59%-
1.54%-0.69%10-Feb-1441.95113.720.616.2813.37-0.27-0.64%-
5.28-4.44%1.62%2.38%-0.55%3-Feb-1442.221190.606.1313.44-
1.09-2.52%4.313.76%-0.60%-0.82%1.56%27-Jan-
1443.31114.690.616.1813.240.350.81%-9.42-7.59%-
0.52%0.56%2.06%21-Jan-1442.96124.110.616.1512.97-0.65-

16. 1.49%-4.23-3.30%0.15%-0.06%-1.02%13-Jan-
1443.61128.340.616.1513.100.541.25%0.350.27%0.46%0.15%0.
33%6-Jan-1443.07127.990.616.1413.06-0.13-0.30%2.471.97%-
0.85%-0.25%0.68%30-Dec-1343.2125.520.616.1612.97-0.67-
1.53%-3.53-2.74%-0.31%0.09%0.30%23-Dec-
1343.87129.050.616.1512.930.972.26%1.240.97%0.77%0.07%0.
15%16-Dec-1342.9127.810.616.1512.910.220.52%3.352.69%-
0.40%0.31%-1.70%9-Dec-1342.68124.460.616.1313.14-1.47-
3.33%1.491.21%-1.17%0.98%1.00%2-Dec-
1344.15122.970.626.0713.01-0.12-0.27%-6.78-5.23%-0.34%-
0.75%0.60%25-Nov-1344.27129.750.626.1112.93-0.54-1.21%-
2.73-2.06%-0.79%-0.71%-1.94%18-Nov-
1344.81132.480.636.1613.18-0.08-0.18%-1.85-1.38%-
0.09%3.21%0.98%11-Nov-
1344.89134.330.635.9713.060.10.22%4.673.60%1.06%1.27%1.4
4%4-Nov-1344.79129.660.625.8912.87-0.26-
0.58%1.671.30%0.02%-0.20%0.19%28-Oct-
1345.05127.990.625.9012.85-0.19-0.42%-4.67-3.52%-1.05%-
1.58%-1.46%21-Oct-
1345.24132.660.636.0013.040.621.39%2.291.76%0.74%0.58%-
0.40%14-Oct-
1344.62130.370.625.9613.092.616.21%5.294.23%0.62%-0.66%-
0.80%7-Oct-1342.01125.080.626.0013.190.461.11%2.381.94%-
0.93%1.30%2.52%30-Sep-
1341.55122.70.625.9312.870.090.22%0.170.14%-0.89%0.42%-

17. 0.59%23-Sep-1341.46122.530.635.9012.95-0.69-
1.64%3.172.66%-1.29%-2.93%-2.05%16-Sep-
1342.15119.360.646.0813.220.020.05%3.973.44%-0.85%-
0.09%-0.84%9-Sep-
1342.13115.390.646.0813.331.253.06%1.851.63%0.13%1.03%2.
56%3-Sep-1340.88113.540.646.0213.00-0.92-
2.20%1.51.34%0.45%1.73%0.62%26-Aug-
1341.8112.040.645.9212.92-0.2-0.48%-4.32-3.71%-
1.26%1.19%2.53%19-Aug-1342116.360.655.8512.60-0.09-
0.21%-2.03-1.71%-0.69%-1.50%-0.46%12-Aug-
1342.09118.390.655.9412.66-1.42-3.26%0.360.31%-
0.05%0.56%0.05%5-Aug-1343.51118.030.655.9112.65-0.82-
1.85%2.111.82%0.13%-1.15%1.07%29-Jul-
1344.33115.920.655.9812.52-0.68-1.51%2.292.02%-1.71%-
1.48%-2.38%22-Jul-
1345.01113.630.666.0712.820.942.13%4.233.87%-0.97%-
3.01%-2.03%15-Jul-1344.07109.40.676.2513.09-0.4-
0.90%00.00%1.75%3.00%0.81%8-Jul-
1344.47109.40.666.0712.98-0.33-0.74%2.462.30%1.53%-
0.11%-2.45%1-Jul-
1344.8106.940.656.0813.310.841.91%0.890.84%1.74%6.44%4.5
5%24-Jun-1343.96106.050.645.7112.730.711.64%2.112.03%-
0.91%-1.08%-0.48%17-Jun-1343.25103.940.645.7712.79-1.35-
3.03%-0.88-0.84%-1.62%-1.70%-0.20%10-Jun-
1344.6104.820.655.8712.820.721.64%-2.2-2.06%-

18. 1.87%0.47%2.84%3-Jun-
1343.88107.020.675.8512.461.543.64%-2.03-1.86%1.58%-
0.23%0.89%28-May-1342.34109.050.655.8612.35-2.54-5.66%-
3.26-2.90%0.19%0.98%1.96%20-May-
1344.88112.310.655.8012.12-1.71-3.67%00.00%1.55%-
0.03%0.37%13-May-
1346.59112.310.645.8012.070.40.87%0.680.61%-0.28%-0.73%-
0.65%6-May-1346.19111.630.655.8512.150.180.39%0.920.83%-
1.28%0.53%-0.85%29-Apr-1346.01110.710.655.8212.26-0.83-
1.77%1.351.23%-0.02%1.75%1.39%22-Apr-
1346.84109.360.655.7212.091.212.65%0.670.62%-0.22%-
0.13%-0.90%15-Apr-
1345.63108.690.665.7212.201.212.72%1.11.02%-0.22%-2.16%-
1.09%8-Apr-1344.42107.590.665.8512.331.593.71%2.442.32%-
0.32%1.02%-0.11%1-Apr-
1342.83105.150.665.7912.350.350.82%-2.44-2.27%-0.54%-
0.33%-1.29%25-Mar-1342.48107.590.665.8112.510.110.26%-
0.42-0.39%-1.27%1.36%-0.95%18-Mar-
1342.37108.010.675.7312.630.872.10%2.11.98%1.50%-0.34%-
0.98%11-Mar-
1341.5105.910.665.7512.750.050.12%0.420.40%0.25%1.53%0.2
9%4-Mar-
1341.45105.490.665.6612.711.072.65%1.351.30%2.05%2.00%0.
15%25-Feb-
1340.38104.140.655.5512.701.142.91%0.750.73%1.15%0.29%-

19. 0.28%19-Feb-
1339.24103.390.645.5412.730.872.27%0.170.16%0.64%1.59%0.
96%11-Feb-1338.37103.220.635.4512.610.040.10%3.533.54%-
0.37%-1.36%-0.66%4-Feb-1338.3399.690.645.5312.69-0.18-
0.47%-3.02-2.94%0.87%-1.38%0.27%28-Jan-
1338.51102.710.635.6012.661.634.42%0.160.16%1.53%1.51%0.
10%22-Jan-
1336.88102.550.625.5212.650.110.30%1.431.41%0.29%-1.63%-
0.77%14-Jan-1336.77101.120.625.6112.75-0.65-
1.74%2.862.91%0.76%0.59%-2.16%7-Jan-
1337.4298.260.625.5813.03-0.43-1.14%1.771.83%-
0.70%0.08%0.66%31-Dec-
1237.8596.490.625.5712.941.23.27%2.12.22%0.45%-
0.87%1.43%24-Dec-1236.6594.390.625.6212.76-0.57-1.53%-
1.34-1.40%-0.81%-1.10%-0.57%17-Dec-
1237.2295.730.625.6912.83-0.55-1.46%-0.42-
0.44%0.15%0.15%-0.92%10-Dec-1237.7796.150.625.6812.95-
0.17-0.45%0.750.79%-0.40%0.25%-0.19%3-Dec-
1237.9495.40.625.6612.980.250.66%-1.34-1.39%-0.87%-2.05%-
1.08%26-Nov-1237.6996.740.635.7813.120.310.83%-1.18-
1.21%-0.11%0.68%-0.59%19-Nov-
1237.3897.920.635.7413.202.015.68%2.192.29%0.69%0.13%1.2
5%12-Nov-1235.3795.730.635.7413.03-1.06-
2.91%0.170.18%0.93%0.05%-0.29%5-Nov-
1236.4395.560.625.7313.07-1.6-4.21%0.330.35%-

20. 0.71%1.24%1.43%31-Oct-1238.0395.230.625.6612.89-0.18-
0.47%2.272.44%0.34%-0.89%0.16%22-Oct-
1238.2192.960.625.7112.86-0.37-0.96%2.362.60%-
0.29%0.57%0.59%15-Oct-1238.5890.60.625.6812.790.461.21%-
1.43-1.55%0.67%-1.03%-0.63%8-Oct-
1238.1292.030.625.7412.87-2.08-5.17%-3.03-3.19%0.55%-
0.08%0.08%1-Oct-
1240.295.060.625.7412.861.694.39%1.091.16%0.17%1.05%1.03
%24-Sep-1238.5193.970.625.6812.73-0.06-0.16%-0.5-0.53%-
1.59%-0.83%-1.86%17-Sep-
1238.5794.470.635.7312.970.942.50%1.681.81%-0.66%-1.16%-
1.81%10-Sep-1237.6392.790.635.8013.210.691.87%1.942.14%-
0.57%-0.53%0.21%4-Sep-
1236.9490.850.635.8313.180.661.82%1.761.98%-0.52%-
1.55%0.32%27-Aug-1236.2889.090.645.9213.14-0.2-
0.55%2.112.43%-0.18%0.08%0.29%20-Aug-
1236.4886.980.645.9213.10-0.75-2.01%-0.26-0.30%-0.57%-
0.99%-0.12%13-Aug-1237.2387.240.645.9813.12-0.46-
1.22%1.11.28%0.76%-1.33%-0.89%6-Aug-
1237.6986.140.646.0613.230.120.32%-1.52-1.73%-1.27%-
0.45%-0.98%30-Jul-1237.5787.660.646.0813.36-0.37-
0.98%0.760.87%0.73%-0.21%0.51%23-Jul-
1237.9486.90.646.1013.300.350.93%2.362.79%-0.67%-0.41%-
0.90%16-Jul-1237.5984.540.646.1213.42-0.61-1.60%-0.85-
1.00%1.10%2.82%1.16%9-Jul-

21. 1238.285.390.645.9513.260.661.76%2.533.05%-0.79%-0.32%-
4.15%2-Jul-1237.5482.860.645.9713.840.411.10%-0.34-
0.41%0.69%0.25%-0.66%25-Jun-
1237.1383.20.645.9613.930.411.12%3.834.83%-1.28%-
0.73%0.60%18-Jun-
1236.7279.370.656.0013.850.330.91%0.81.02%-0.63%-1.96%-
3.17%11-Jun-
1236.3978.570.656.1214.300.932.62%1.221.58%1.96%2.17%2.2
7%4-Jun-
1235.4677.350.645.9913.981.183.44%3.24.32%0.91%0.40%0.94
%29-May-1234.2874.150.635.9713.85-0.36-1.04%-3.71-
4.76%1.76%1.54%2.07%21-May-1234.6477.860.625.8813.57-
0.06-0.17%-3.49-4.29%0.58%0.88%2.07%14-May-
1234.781.350.625.8313.290.310.90%-1.83-
2.20%0.25%1.56%2.55%7-May-
1234.3983.180.625.7412.960.752.23%-0.4-0.48%-0.68%0.18%-
1.10%30-Apr-1233.6483.580.625.7313.110.020.06%3.444.29%-
1.38%-1.14%-0.56%23-Apr-
1233.6280.140.635.7913.181.263.89%-0.8-0.99%0.01%-
0.30%1.22%16-Apr-1232.3680.940.635.8113.021.233.95%-
1.04-1.27%0.77%2.04%1.69%9-Apr-
1231.1381.980.625.6912.81-0.34-1.08%-1.28-1.54%-0.41%-
0.92%0.41%2-Apr-1231.4783.260.635.7512.75-0.06-0.19%-
1.36-1.61%-0.46%0.25%0.78%26-Mar-
1231.5384.620.635.7312.66-0.98-3.01%0.881.05%-

22. 1.48%0.49%0.03%19-Mar-1232.5183.740.645.7012.65-0.12-
0.37%-0.56-0.66%1.42%1.53%-0.86%12-Mar-
1232.6384.30.635.6212.760.381.18%1.361.64%-0.27%0.97%-
1.10%5-Mar-1232.2582.940.635.5612.900.361.13%-0.16-
0.19%-0.03%-1.80%1.59%27-Feb-
1231.8983.10.635.6712.700.441.40%0.560.68%-0.66%-1.20%-
0.23%21-Feb-1231.4582.540.645.7312.73-0.27-
0.85%1.61.98%0.57%-1.32%0.39%13-Feb-
1231.7280.940.635.8112.680.642.06%2.453.12%-0.67%0.11%-
1.87%6-Feb-1231.0878.490.645.8012.92-0.13-0.42%2.763.64%-
0.84%-2.33%-2.04%30-Jan-
1231.2175.730.645.9413.190.521.69%0.080.11%-1.62%-2.05%-
3.14%23-Jan-1230.6975.650.656.0713.62-1.45-
4.51%1.922.60%0.87%0.49%-0.99%17-Jan-
1232.1473.730.656.0413.750.040.12%-3.6-4.66%0.41%0.99%-
1.29%9-Jan-1232.177.330.645.9813.930.491.55%-1.28-
1.63%0.64%0.07%0.57%3-Jan-1231.6178.610.645.9713.86-
1.05-3.21%00.00%-0.70%0.32%-0.16%27-Dec-
1132.6678.610.645.9613.880.110.34%1.161.50%0.46%3.64%2.2
3%19-Dec-
1132.5577.450.645.7513.570.983.10%2.923.92%0.39%-1.07%-
0.34%12-Dec-1131.5774.530.645.8113.620.280.89%-1.6-2.10%-
0.90%-1.36%-4.05%5-Dec-
1131.2976.130.655.8914.200.481.56%-0.8-
1.04%0.89%1.44%4.07%28-Nov-

23. 1130.8176.930.645.8113.642.037.05%2.83.78%1.67%1.95%0.79
%21-Nov-1128.7874.130.635.6913.53-0.9-3.03%-4.92-
6.22%1.02%1.85%1.29%14-Nov-1129.6879.050.625.5913.36-
0.87-2.85%-0.29-0.37%0.11%3.24%1.91%7-Nov-
1130.5579.340.625.4213.110.290.96%1.051.34%-0.52%-3.48%-
4.19%31-Oct-1130.2678.290.635.6113.68-0.38-1.24%-0.64-
0.81%-1.57%-0.45%1.47%24-Oct-
1130.6478.930.645.6413.490.180.59%5.086.88%-0.57%-
3.34%0.21%17-Oct-1130.4673.850.645.8313.460.070.23%-0.6-
0.81%-1.42%0.51%-1.89%10-Oct-
1130.3974.450.655.8013.720.953.23%3.895.51%0.00%-
0.03%1.03%3-Oct-1129.4470.560.655.8013.58-0.11-0.37%-2.6-
3.55%0.76%1.12%-0.85%26-Sep-
1129.5573.160.645.7413.690.742.57%4.686.83%0.68%1.36%5.9
2%19-Sep-1128.8168.480.645.6612.93-0.67-2.27%-1.68-
2.39%1.28%5.04%3.78%12-Sep-
1129.4870.160.635.3912.461.184.17%1.842.69%1.51%0.45%1.0
3%6-Sep-1128.368.320.625.3712.33-0.25-0.88%-2.88-
4.04%1.96%-1.20%-1.33%29-Aug-1128.5571.20.615.4312.50-
0.16-0.56%1.642.36%0.32%-0.69%1.88%22-Aug-
1128.7169.560.615.4712.270.843.01%3.535.35%-0.50%-1.32%-
0.21%15-Aug-1127.8766.030.615.5412.290.331.20%-3.93-
5.62%-0.33%0.19%1.96%8-Aug-1127.5469.960.615.5312.06-
0.6-2.13%1.762.58%-0.14%2.33%2.84%1-Aug-
1128.1468.20.615.4011.72-0.2-0.71%-4.08-5.64%-

24. 0.17%0.10%1.14%25-Jul-1128.3472.280.615.4011.59-1.16-
3.93%0.921.29%-1.36%-2.52%-1.08%18-Jul-
1129.571.360.625.5411.72-0.06-0.20%3.845.69%-
0.94%3.10%1.50%11-Jul-1129.5667.520.635.3711.54-0.53-
1.76%-1.08-1.57%1.19%-0.30%-1.49%5-Jul-
1130.0968.60.625.3911.720.130.43%-2.12-3.00%-0.66%-1.19%-
1.16%27-Jun-
1129.9670.720.635.4511.861.435.01%2.63.82%1.36%-1.21%-
0.76%20-Jun-
1128.5368.120.625.5211.95http://www.exchangerates.org.uk/US
D-MXN-exchange-rate-history-
full.htmlhttp://www.exchangerates.org.uk/USD-NOK-exchange-
rate-history-full.htmlhttp://www.exchangerates.org.uk/GBP-
USD-exchange-rate-history-
full.htmlhttp://finance.yahoo.com/q/hp?s=VZhttp://finance.yaho
o.com/q?s=TEL.OLhttp://www.exchangerates.org.uk/USD-
MXN-exchange-rate-history-
full.htmlhttp://www.exchangerates.org.uk/USD-NOK-exchange-
rate-history-full.htmlhttp://www.exchangerates.org.uk/GBP-
USD-exchange-rate-history-
full.htmlhttp://finance.yahoo.com/q/hp?s=VZhttp://finance.yaho
o.com/q?s=TEL.OL
Regression 1 Regression 1Verizon Returns vs Pound
ReturnsSUMMARY OUTPUTRegression StatisticsMultiple
R0.0939406908R Square0.0088248534Adjusted R

25. Square0.0049830893Standard
Error0.0223072528Observations260ANOVAdfSSMSFSignifican
ce
FRegression10.00114305990.00114305992.29708359960.13084
13661Residual2580.12838429060.0004976135Total2590.12952
73504CoefficientsStandard Errort StatP-valueLower 95%Upper
95%Lower 95.0%Upper
95.0%Intercept0.00257077530.00138564311.8552939490.06469
48093-0.00015783510.0052993857-
0.00015783510.0052993857X Variable
10.21207121030.13992435521.51561327510.1308413661-
0.0634680240.4876104445-0.0634680240.4876104445
Regression 2Regression 2Verizon Returns vs Norwegian Krone
ReturnsSUMMARY OUTPUTRegression StatisticsMultiple
R0.0833731999R Square0.0069510905Adjusted R
Square0.0031020637Standard
Error0.0223283282Observations260ANOVAdfSSMSFSignifican
ce
FRegression10.00090035630.00090035631.80593455150.18017
7295Residual2580.12862699410.0004985542Total2590.129527
3504CoefficientsStandard Errort StatP-valueLower 95%Upper
95%Lower 95.0%Upper
95.0%Intercept0.0028888620.00139268932.07430473030.03904
279180.00014637630.00563134770.00014637630.0056313477X
Variable 1-0.11885268080.0884418826-

26. 1.34385064330.180177295-0.29301255850.055307197-
0.29301255850.055307197
Regression 3Regression 3Verizon Returns vs Mexican Peso
ReturnsSUMMARY OUTPUTRegression StatisticsMultiple
R0.0284997849R Square0.0008122377Adjusted R Square-
0.003060583Standard
Error0.0223972368Observations260ANOVAdfSSMSFSignifican
ce
FRegression10.0001052070.0001052070.20972768580.6473663
873Residual2580.12942214340.0005016362Total2590.1295273
504CoefficientsStandard Errort StatP-valueLower 95%Upper
95%Lower 95.0%Upper
95.0%Intercept0.00276560630.00139899321.97685476130.0491
2276140.0000107070.00552050560.0000107070.0055205056X
Variable 1-0.04070725310.0888881598-
0.4579603540.6473663873-0.21574594060.1343314344-
0.21574594060.1343314344
Regression 4Regression 4Telenor Returns vs Pound
ReturnsSUMMARY OUTPUTRegression StatisticsMultiple
R0.007849319R Square0.0000616118Adjusted R Square-
0.0038141184Standard
Error0.0303489259Observations260ANOVAdfSSMSFSignifican
ce
FRegression10.00001464190.00001464190.01589682610.89976
47252Residual2580.2376327850.0009210573Total2590.237647

27. 4269CoefficientsStandard Errort StatP-valueLower 95%Upper
95%Lower 95.0%Upper
95.0%Intercept0.00279937540.00188516181.48495235810.1387
772192-0.00091288780.0065116387-
0.00091288780.0065116387X Variable
10.02400190770.19036651110.12608261620.8997647252-
0.35086808970.3988719052-0.35086808970.3988719052
Regression 5Regression 5Telenor Returns vs Norwegian Krone
ReturnsSUMMARY OUTPUTRegression StatisticsMultiple
R0.0503219917R Square0.0025323028Adjusted R Square-
0.001333851Standard
Error0.030311409Observations260ANOVAdfSSMSFSignificanc
e
FRegression10.00060179530.00060179530.65499277530.41907
90064Residual2580.23704563160.0009187815Total2590.23764
74269CoefficientsStandard Errort StatP-valueLower 95%Upper
95%Lower 95.0%Upper
95.0%Intercept0.00297599020.00189061961.57408196780.1166
939416-0.00074702050.0066990009-
0.00074702050.0066990009X Variable 1-
0.0971686460.1200626421-0.80931623930.4190790064-
0.33359616720.1392588752-0.33359616720.1392588752
Regression 6Regression 6Telenor Returns vs Mexican Peso
ReturnsSUMMARY OUTPUTRegression StatisticsMultiple
R0.0768174169R Square0.0059009155Adjusted R

28. Square0.0020478183Standard
Error0.0302601824Observations260ANOVAdfSSMSFSignifican
ce
FRegression10.00140233740.00140233741.53147330210.21701
65373Residual2580.23624508950.0009156786Total2590.23764
74269CoefficientsStandard Errort StatP-valueLower 95%Upper
95%Lower 95.0%Upper
95.0%Intercept0.0030916170.00189013451.63565983080.10313
01525-0.00063043840.0068136724-
0.00063043840.0068136724X Variable 1-
0.14861947790.1200939187-1.23752709140.2170165373-
0.38510858920.0878696333-0.38510858920.0878696333
Currenct Returns% ReturnDateBritish Pound to US DollarUS
Dollar to Norwegian KroneUS Dollar to Mexican PesoBritish
Pound to US DollarUS Dollar to Norwegian KroneUS Dollar to
Mexican Peso13-Jun-160.708.2718.841.82%1.18%0.89%6-Jun-
160.698.1818.680.28%-2.35%1.18%31-May-160.698.3718.46-
0.08%0.25%-0.32%23-May-160.698.3518.52-
0.50%2.26%1.17%16-May-160.698.1718.310.00%-
0.62%0.58%9-May-160.698.2218.201.78%2.50%5.84%2-May-
160.688.0217.20-1.25%-2.25%-2.13%25-Apr-160.698.2017.57-
1.46%-0.16%0.79%18-Apr-160.708.2217.43-0.31%0.22%-
1.31%11-Apr-160.708.2017.660.24%-1.59%1.01%4-Apr-
160.708.3317.49-0.04%-1.21%0.24%28-Mar-
160.708.4317.440.77%0.23%0.12%21-Mar-160.708.4117.42-

29. 0.61%-0.74%-1.83%14-Mar-160.708.4817.75-0.15%-
0.35%0.04%7-Mar-160.708.5117.74-2.33%-2.11%-2.22%29-
Feb-160.728.6918.151.59%0.94%0.30%22-Feb-
160.718.6118.091.09%-0.24%-4.19%16-Feb-
160.708.6318.880.92%0.46%1.20%8-Feb-160.698.5918.66-
0.06%-1.09%2.25%1-Feb-160.698.6818.25-1.28%-0.85%-
2.02%25-Jan-160.708.7618.62-0.44%-0.62%1.97%19-Jan-
160.718.8118.262.57%-1.45%2.04%11-Jan-
160.698.9417.901.16%0.67%3.50%4-Jan-
160.688.8817.291.21%2.22%0.41%28-Dec-
150.678.6917.220.03%-0.95%0.44%21-Dec-
150.678.7717.151.77%1.33%-0.97%14-Dec-150.668.6617.32-
0.72%-0.10%2.54%7-Dec-150.668.6716.890.05%-
0.24%1.91%30-Nov-150.668.6916.570.46%0.46%0.05%23-Nov-
150.668.6516.560.50%-0.61%-1.24%16-Nov-150.668.7016.77-
0.54%0.52%0.02%9-Nov-150.668.6616.772.00%1.96%1.98%2-
Nov-150.658.4916.44-0.44%1.96%-0.52%26-Oct-
150.658.3316.530.74%2.39%0.20%19-Oct-150.658.1316.50-
0.80%0.44%0.16%12-Oct-150.658.1016.47-1.28%-3.64%-
1.79%5-Oct-150.668.4016.770.12%-1.56%-1.84%28-Sep-
150.668.5417.082.29%3.81%2.56%21-Sep-150.648.2216.66-
0.58%0.28%-0.49%14-Sep-150.658.2016.74-0.18%-0.38%-
0.53%8-Sep-150.658.2316.83-0.29%-0.46%0.50%31-Aug-
150.658.2716.752.63%0.48%-2.61%24-Aug-150.638.2317.19-
1.08%0.23%4.63%17-Aug-

30. 150.648.2116.430.01%0.16%1.67%10-Aug-
150.648.2016.160.02%-0.61%-0.11%3-Aug-150.648.2516.18-
0.18%0.90%-0.71%27-Jul-150.648.1716.300.03%-
0.63%1.82%20-Jul-150.648.2316.01-0.49%1.85%1.91%13-Jul-
150.658.0815.710.74%-0.08%-0.04%6-Jul-
150.648.0815.710.79%2.63%0.19%29-Jun-
150.647.8815.680.62%1.73%2.22%22-Jun-150.637.7415.34-
1.43%-0.18%-0.59%15-Jun-150.647.7615.43-1.65%-0.85%-
1.27%8-Jun-150.657.8215.63-0.91%-1.72%0.99%1-Jun-
150.667.9615.481.26%2.74%1.25%26-May-
150.657.7515.291.72%4.52%1.19%18-May-150.647.4115.11-
0.51%-2.06%-1.56%11-May-150.647.5715.35-2.95%-0.32%-
0.71%4-May-150.667.5915.460.72%-1.87%0.62%27-Apr-
150.667.7415.36-3.65%-4.33%-0.15%20-Apr-
150.688.0915.391.49%1.78%3.23%13-Apr-150.677.9414.91-
0.54%-0.89%-2.33%6-Apr-
150.688.0215.260.96%1.65%2.25%30-Mar-150.677.8914.93-
0.84%-4.61%-3.17%23-Mar-150.678.2715.411.88%4.06%-
0.53%16-Mar-150.667.9415.501.69%3.20%3.11%9-Mar-
150.657.7015.030.61%0.98%-0.45%2-Mar-150.657.6215.10-
0.64%1.31%1.19%23-Feb-150.657.5214.92-0.90%-
0.99%0.66%17-Feb-150.667.6014.82-1.24%-0.69%-0.28%9-
Feb-150.677.6514.860.39%-1.79%1.94%2-Feb-
150.667.7914.580.40%1.37%-0.55%26-Jan-
150.667.6914.660.16%-0.74%0.04%20-Jan-

31. 150.667.7414.650.58%1.40%-1.95%12-Jan-
150.667.6414.941.68%2.84%1.37%5-Jan-
150.647.4314.740.41%-0.16%-0.09%29-Dec-
140.647.4414.760.42%-0.21%0.02%22-Dec-
140.647.4514.750.05%4.80%2.21%15-Dec-
140.647.1114.430.52%1.20%2.34%8-Dec-140.647.0314.10-
0.22%3.37%3.24%1-Dec-140.646.8013.66-
0.39%0.17%0.56%24-Nov-140.646.7913.581.36%-0.39%-
0.14%17-Nov-140.636.8113.600.81%0.21%-0.03%10-Nov-
140.636.8013.610.92%3.22%0.41%3-Nov-
140.626.5913.550.22%0.40%-0.01%27-Oct-140.626.5613.55-
0.53%1.25%0.78%20-Oct-
140.626.4813.450.06%0.06%0.33%13-Oct-
140.626.4813.401.00%0.50%-0.66%6-Oct-
140.626.4413.490.75%1.53%1.64%29-Sep-140.616.3513.28-
0.82%-0.38%0.24%22-Sep-140.626.3713.25-
0.83%1.44%1.55%15-Sep-140.626.2813.042.35%1.49%-
0.44%8-Sep-140.616.1913.100.58%0.07%-0.33%2-Sep-
140.606.1813.140.94%0.71%0.69%25-Aug-
140.606.1413.050.38%-1.46%-1.52%18-Aug-
140.606.2313.260.45%-0.57%0.41%11-Aug-
140.596.2713.200.71%0.75%1.93%4-Aug-
140.596.2212.950.54%0.64%-0.13%28-Jul-
140.596.1812.970.09%0.09%-0.14%21-Jul-
140.596.1812.990.26%-0.19%0.12%14-Jul-140.586.1912.97-

32. 0.18%0.97%-0.03%7-Jul-140.586.1312.98-0.43%-0.02%-
0.05%30-Jun-140.596.1312.98-0.31%2.22%-0.15%23-Jun-
140.596.0013.00-1.03%0.78%0.62%16-Jun-140.605.9512.92-
0.34%-0.50%0.50%9-Jun-140.605.9812.860.39%0.37%-0.12%2-
Jun-140.595.9612.870.01%0.37%-0.23%27-May-
140.595.9412.900.34%0.45%-0.42%19-May-140.595.9112.96-
0.02%-0.44%-0.29%12-May-140.595.9412.99-0.34%-1.24%-
1.07%5-May-140.596.0113.13-0.11%0.36%0.63%28-Apr-
140.605.9913.05-0.38%0.66%-0.13%21-Apr-140.605.9513.07-
0.70%-0.83%0.41%14-Apr-140.606.0013.010.33%-0.09%-
0.40%7-Apr-140.606.0013.07-1.00%-0.78%-1.23%31-Mar-
140.616.0513.230.86%1.34%-0.01%24-Mar-140.605.9713.23-
0.01%-0.21%0.21%17-Mar-140.605.9813.200.16%-0.50%-
0.88%10-Mar-140.606.0113.32-0.05%-0.99%0.51%3-Mar-
140.606.0713.250.17%-0.13%0.41%24-Feb-140.606.0813.20-
1.67%-1.57%-0.62%18-Feb-140.616.1813.28-0.59%-1.54%-
0.69%10-Feb-140.616.2813.371.62%2.38%-0.55%3-Feb-
140.606.1313.44-0.60%-0.82%1.56%27-Jan-140.616.1813.24-
0.52%0.56%2.06%21-Jan-140.616.1512.970.15%-0.06%-
1.02%13-Jan-140.616.1513.100.46%0.15%0.33%6-Jan-
140.616.1413.06-0.85%-0.25%0.68%30-Dec-130.616.1612.97-
0.31%0.09%0.30%23-Dec-
130.616.1512.930.77%0.07%0.15%16-Dec-130.616.1512.91-
0.40%0.31%-1.70%9-Dec-130.616.1313.14-
1.17%0.98%1.00%2-Dec-130.626.0713.01-0.34%-

33. 0.75%0.60%25-Nov-130.626.1112.93-0.79%-0.71%-1.94%18-
Nov-130.636.1613.18-0.09%3.21%0.98%11-Nov-
130.635.9713.061.06%1.27%1.44%4-Nov-
130.625.8912.870.02%-0.20%0.19%28-Oct-130.625.9012.85-
1.05%-1.58%-1.46%21-Oct-130.636.0013.040.74%0.58%-
0.40%14-Oct-130.625.9613.090.62%-0.66%-0.80%7-Oct-
130.626.0013.19-0.93%1.30%2.52%30-Sep-130.625.9312.87-
0.89%0.42%-0.59%23-Sep-130.635.9012.95-1.29%-2.93%-
2.05%16-Sep-130.646.0813.22-0.85%-0.09%-0.84%9-Sep-
130.646.0813.330.13%1.03%2.56%3-Sep-
130.646.0213.000.45%1.73%0.62%26-Aug-130.645.9212.92-
1.26%1.19%2.53%19-Aug-130.655.8512.60-0.69%-1.50%-
0.46%12-Aug-130.655.9412.66-0.05%0.56%0.05%5-Aug-
130.655.9112.650.13%-1.15%1.07%29-Jul-130.655.9812.52-
1.71%-1.48%-2.38%22-Jul-130.666.0712.82-0.97%-3.01%-
2.03%15-Jul-130.676.2513.091.75%3.00%0.81%8-Jul-
130.666.0712.981.53%-0.11%-2.45%1-Jul-
130.656.0813.311.74%6.44%4.55%24-Jun-130.645.7112.73-
0.91%-1.08%-0.48%17-Jun-130.645.7712.79-1.62%-1.70%-
0.20%10-Jun-130.655.8712.82-1.87%0.47%2.84%3-Jun-
130.675.8512.461.58%-0.23%0.89%28-May-
130.655.8612.350.19%0.98%1.96%20-May-
130.655.8012.121.55%-0.03%0.37%13-May-130.645.8012.07-
0.28%-0.73%-0.65%6-May-130.655.8512.15-1.28%0.53%-
0.85%29-Apr-130.655.8212.26-0.02%1.75%1.39%22-Apr-

34. 130.655.7212.09-0.22%-0.13%-0.90%15-Apr-130.665.7212.20-
0.22%-2.16%-1.09%8-Apr-130.665.8512.33-0.32%1.02%-
0.11%1-Apr-130.665.7912.35-0.54%-0.33%-1.29%25-Mar-
130.665.8112.51-1.27%1.36%-0.95%18-Mar-
130.675.7312.631.50%-0.34%-0.98%11-Mar-
130.665.7512.750.25%1.53%0.29%4-Mar-
130.665.6612.712.05%2.00%0.15%25-Feb-
130.655.5512.701.15%0.29%-0.28%19-Feb-
130.645.5412.730.64%1.59%0.96%11-Feb-130.635.4512.61-
0.37%-1.36%-0.66%4-Feb-130.645.5312.690.87%-
1.38%0.27%28-Jan-130.635.6012.661.53%1.51%0.10%22-Jan-
130.625.5212.650.29%-1.63%-0.77%14-Jan-
130.625.6112.750.76%0.59%-2.16%7-Jan-130.625.5813.03-
0.70%0.08%0.66%31-Dec-120.625.5712.940.45%-
0.87%1.43%24-Dec-120.625.6212.76-0.81%-1.10%-0.57%17-
Dec-120.625.6912.830.15%0.15%-0.92%10-Dec-
120.625.6812.95-0.40%0.25%-0.19%3-Dec-120.625.6612.98-
0.87%-2.05%-1.08%26-Nov-120.635.7813.12-0.11%0.68%-
0.59%19-Nov-120.635.7413.200.69%0.13%1.25%12-Nov-
120.635.7413.030.93%0.05%-0.29%5-Nov-120.625.7313.07-
0.71%1.24%1.43%31-Oct-120.625.6612.890.34%-
0.89%0.16%22-Oct-120.625.7112.86-0.29%0.57%0.59%15-Oct-
120.625.6812.790.67%-1.03%-0.63%8-Oct-
120.625.7412.870.55%-0.08%0.08%1-Oct-
120.625.7412.860.17%1.05%1.03%24-Sep-120.625.6812.73-

35. 1.59%-0.83%-1.86%17-Sep-120.635.7312.97-0.66%-1.16%-
1.81%10-Sep-120.635.8013.21-0.57%-0.53%0.21%4-Sep-
120.635.8313.18-0.52%-1.55%0.32%27-Aug-120.645.9213.14-
0.18%0.08%0.29%20-Aug-120.645.9213.10-0.57%-0.99%-
0.12%13-Aug-120.645.9813.120.76%-1.33%-0.89%6-Aug-
120.646.0613.23-1.27%-0.45%-0.98%30-Jul-
120.646.0813.360.73%-0.21%0.51%23-Jul-120.646.1013.30-
0.67%-0.41%-0.90%16-Jul-
120.646.1213.421.10%2.82%1.16%9-Jul-120.645.9513.26-
0.79%-0.32%-4.15%2-Jul-120.645.9713.840.69%0.25%-
0.66%25-Jun-120.645.9613.93-1.28%-0.73%0.60%18-Jun-
120.656.0013.85-0.63%-1.96%-3.17%11-Jun-
120.656.1214.301.96%2.17%2.27%4-Jun-
120.645.9913.980.91%0.40%0.94%29-May-
120.635.9713.851.76%1.54%2.07%21-May-
120.625.8813.570.58%0.88%2.07%14-May-
120.625.8313.290.25%1.56%2.55%7-May-120.625.7412.96-
0.68%0.18%-1.10%30-Apr-120.625.7313.11-1.38%-1.14%-
0.56%23-Apr-120.635.7913.180.01%-0.30%1.22%16-Apr-
120.635.8113.020.77%2.04%1.69%9-Apr-120.625.6912.81-
0.41%-0.92%0.41%2-Apr-120.635.7512.75-
0.46%0.25%0.78%26-Mar-120.635.7312.66-
1.48%0.49%0.03%19-Mar-120.645.7012.651.42%1.53%-
0.86%12-Mar-120.635.6212.76-0.27%0.97%-1.10%5-Mar-
120.635.5612.90-0.03%-1.80%1.59%27-Feb-120.635.6712.70-

36. 0.66%-1.20%-0.23%21-Feb-120.645.7312.730.57%-
1.32%0.39%13-Feb-120.635.8112.68-0.67%0.11%-1.87%6-Feb-
120.645.8012.92-0.84%-2.33%-2.04%30-Jan-120.645.9413.19-
1.62%-2.05%-3.14%23-Jan-120.656.0713.620.87%0.49%-
0.99%17-Jan-120.656.0413.750.41%0.99%-1.29%9-Jan-
120.645.9813.930.64%0.07%0.57%3-Jan-120.645.9713.86-
0.70%0.32%-0.16%27-Dec-
110.645.9613.880.46%3.64%2.23%19-Dec-
110.645.7513.570.39%-1.07%-0.34%12-Dec-110.645.8113.62-
0.90%-1.36%-4.05%5-Dec-
110.655.8914.200.89%1.44%4.07%28-Nov-
110.645.8113.641.67%1.95%0.79%21-Nov-
110.635.6913.531.02%1.85%1.29%14-Nov-
110.625.5913.360.11%3.24%1.91%7-Nov-110.625.4213.11-
0.52%-3.48%-4.19%31-Oct-110.635.6113.68-1.57%-
0.45%1.47%24-Oct-110.645.6413.49-0.57%-3.34%0.21%17-
Oct-110.645.8313.46-1.42%0.51%-1.89%10-Oct-
110.655.8013.720.00%-0.03%1.03%3-Oct-
110.655.8013.580.76%1.12%-0.85%26-Sep-
110.645.7413.690.68%1.36%5.92%19-Sep-
110.645.6612.931.28%5.04%3.78%12-Sep-
110.635.3912.461.51%0.45%1.03%6-Sep-
110.625.3712.331.96%-1.20%-1.33%29-Aug-
110.615.4312.500.32%-0.69%1.88%22-Aug-110.615.4712.27-
0.50%-1.32%-0.21%15-Aug-110.615.5412.29-

37. 0.33%0.19%1.96%8-Aug-110.615.5312.06-0.14%2.33%2.84%1-
Aug-110.615.4011.72-0.17%0.10%1.14%25-Jul-
110.615.4011.59-1.36%-2.52%-1.08%18-Jul-110.625.5411.72-
0.94%3.10%1.50%11-Jul-110.635.3711.541.19%-0.30%-
1.49%5-Jul-110.625.3911.72-0.66%-1.19%-1.16%27-Jun-
110.635.4511.861.36%-1.21%-0.76%20-Jun-110.625.5211.95
economic risk example-2.xlsx
table
(18)pricesreturnsDateLFLBRLUSDLFLBRLUSD6/1/166.233.48
803.661%-1.477%SUMMARY OUTPUT5/2/166.013.5403-
16.295%-0.648%4/1/167.183.56342.571%-3.640%Regression
Statistics3/1/1673.698022.592%-6.720%Multiple
R0.53063638492/1/165.713.964411.523%-2.249%R
Square0.2815749731/4/165.124.0556-5.009%4.504%Adjusted R
Square0.2691883346portion of risk that can be eliminated by
hedging exchange rate risk12/1/155.393.8808-
2.355%2.509%Standard
Error0.091591840411/2/155.523.78580.181%-
2.307%Observations6010/1/155.513.875212.910%-
0.717%9/1/154.883.9032-
11.594%11.031%ANOVA8/3/155.523.5154-
10.968%8.876%dfSSMSFSignificance F7/1/156.23.2288-
11.932%3.763%Regression10.19070152380.190701523822.7321
5411790.00001293446/1/157.043.1117-

38. 16.390%1.816%Residual580.48656578360.00838906525/1/158.
423.0562-
12.017%0.463%Total590.67726730744/1/159.573.042118.734%
-3.161%3/2/158.063.1414-
23.746%11.516%CoefficientsStandard Errort StatP-valueLower
95%Upper 95%Lower 95.0%Upper
95.0%2/2/1510.572.81701.929%6.923%Intercept0.00185778270
.01260540040.14737990260.8833433019-
0.02337466760.027090233-
0.02337466760.0270902331/2/1510.372.6346-13.439%-
0.276%X Variable 1-1.49612699010.3137965481-
4.76782488330.0000129-2.1242590268-0.8679949534-
2.1242590268-
0.867994953412/1/1411.982.64190.672%3.494%1% increase in
exchange rate is associated with -1.49% change in stock
price11/3/1411.92.5527-2.459%4.213%BRL gets weaker, stock
price declines10/1/1412.22.44957.300%4.774%long natural
relationship9/2/1411.372.3379-8.306%3.059%statistically
significant8/1/1412.42.26855.802%1.992%7/1/1411.722.2242-
12.668%-0.528%6/2/1413.422.2360-
7.064%0.743%5/1/1414.442.2195-5.806%-
0.582%4/1/1415.332.23251.860%-3.983%3/3/1415.052.3251-
2.273%-2.274%2/3/1415.42.379210.791%-
0.277%1/2/1413.92.3858-
14.776%1.649%12/2/1316.3099992.34711.241%2.230%11/1/13

39. 16.1100012.2959-
2.659%4.922%10/1/1316.5499992.18829.748%-
3.352%9/3/1315.082.264119.873%-3.277%8/1/1312.582.3408-
6.468%3.952%7/1/1313.452.2518-
20.367%3.607%6/3/1316.8899992.1734-
5.325%6.722%5/1/1317.842.0365-
13.787%1.769%4/1/1320.6929592.0011-
4.784%0.852%3/1/1321.7326051.9842-
7.920%0.573%2/1/1323.6019691.9729-3.593%-
2.722%1/2/1324.4816682.02813.998%-
2.378%12/3/1223.5405522.07756.366%0.547%11/1/1222.13171
82.0662-10.649%1.798%10/1/1224.7695392.0297-
1.938%0.138%9/4/1225.2591342.02697.164%-
0.049%8/1/1223.5705282.0279-4.067%-
0.084%7/2/1224.5697042.0296-5.785%-
0.908%6/1/1226.0784572.04824.067%3.392%5/1/1225.0592991
.9810-10.859%6.954%4/2/1228.111981.8522-
3.094%3.169%3/1/1229.0094911.79538.141%4.572%2/1/1226.8
25551.71687.171%-3.821%1/3/1225.0305331.78509.139%-
2.942%12/1/1122.9345681.8391-
0.980%2.950%11/1/1123.1615451.7864-
6.382%0.909%10/3/1124.7405171.770321.404%1.206%9/1/112
0.3786071.7492-
26.210%9.558%8/1/1127.6172011.59667.525%2.182%7/1/1125.
6844861.5625-8.205%-

40. 1.444%6/1/1127.9801981.5854ERROR:#DIV/0!ERROR:#DIV/0
!