Week 6 discussion

Week 6 discussion - out to protect us from accidents or...

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Derivatives: Are Derivatives Just Another Way to Gamble? Derivative instruments are used as financial management tools to enhance investment returns and to manage such risks relative to interest rates, exchange rates, and financial instrument and commodity prices. Several local and international banks, businesses, municipalities, and others have experienced significant losses with the use of derivatives and some have had gains. Although, their use has increased as efforts to control risk in complex situations are perceived to be wise strategic decisions while predicting what may happen. Julie should explain to Laurie that anything we do in life is considered as a gamble. We take car insurance
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Unformatted text preview: out to protect us from accidents or others, we take several different insurance out on us (medical, life insurance, etc) to protect us and helps us from high doctor bills and to protect our families if something did happen to us they were taken care of. We buy home owners or renters insurance to protect our belongings. When we walk to the mailbox we take a gamble that we are not going to get hit by a car, robbed, or get hurt any way. Companies are doing the same thing trying to predict future assets and liabilities all in all they are just trying to protect their company (their belongings)....
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This note was uploaded on 05/29/2011 for the course EC 2011 taught by Professor Johnson during the Spring '11 term at FIT.

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