Foreign exchange risk is one of the most important components of the financial market. Like any other financial risk, it can be managed or avoided. Financial risk management requires the relevant knowledge and resources and only specialized financial institutions are engaged in doing so. Thee commercial banks do not accept foreign exchange risks, their assets and liabilities are denominated in the same currency. Therefore, it is recommended for households and businesses to avoid the currency risk.
People's behavior is different during the sharp fluctuations of exchange rates. There is no ideal tactic for behavior. However, we would like to share some basic tips to help you reduce your expected financial risks; At the same time, the undesirable attitude characteristic of the period of strong fluctuations in the course will become clearer and more preventive. We hope that the information presented in such circumstances will help you to make the right decision.
Keywords: Foreign exchange and insurance market efficiency; Exchange rate risk insurance; Involvement of financial instruments.
The Peculiarities of Foreign Exchange and Insurance Markets
