Off-Balance-Sheet Hedging Involves Making Changes in the On-Balance-Sheet Assets and Liabilities

question 53

True/False

Off-balance-sheet hedging involves making changes in the on-balance-sheet assets and liabilities to protect the FI's profits from FX risk and taking positions in forward or other derivative securities to hedge FX risk.

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Definitions:

Disclaimer

A statement that denies responsibility to enforceable legal claims and thereby protects the party making the statement from liability.

Crashworthiness Doctrine

A legal principle that holds vehicle manufacturers liable for injuries from accidents if the vehicle's design fails to ensure adequate protection for occupants.

Foreseeable Harm

Injury or damage that could reasonably be anticipated under certain conditions, often used in tort law to establish duty of care.

Vehicle Safety

Measures and regulations designed to protect the health and well-being of drivers, passengers, and pedestrians.