search query: @freeterm international business, risk, / total: 2
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| Author: | Mrak, B. |
| Title: | Poslovna tveganja zaradi sprememb deviznega tecaja (1) |
| Journal: | Bancni vestnik
1994 : VOL. 43:9, p. 9-15 |
| Index terms: | |
| Freeterms: | international business, risk, international payments, transactions, foreign exchange, currency, exchange rate, foreign exchange market, convertibility |
| Language: | slv |
| Abstract: | Due to the exceptional mobility of capital and the size of financial transactions, it is understandable that foreign exchange markets play a very important role in modern market economies.The foreign exchange market represents a system of financial institutions, financial instruments and financial flows, which are responsible for the allocation of the available foreign currency in the market.Foreign currency or foreign exchange is bought by both individuals and companies pursuing different objectives: to pay for imported goods; to exchange foreign earnings into local currency; to finance activities aboard; to increase or decrease placements on foreign markets; to transfer profits from one country into another; etc.However, each of these transactions bears some level of risk which is the result of changes in the exchange rate and can diminish profit in the base currency or can increase debts.In companies, foreign currency risk management represents that financial function which requires a profound understanding of the internal and external factors that can bring about the changes in exchange rates and the related risks. Companies whose business is to decrease business risks as the result of changes in exchange rates must expect occasional losses.Above all, they should be aware of speculative actions in this field. |
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