Currencies
| Name five countries who uses EURO? |
Incoming FX wires
outgoing FX wires
| Name three risk management hedging tools? |
Forward / Window Forward / Options / FCDDA
| What is the infamous "FX Equation"? |
| International = FX = fee income = your FX Advisor |
| Which of the following currencies is worth more than the USD per 1 unit? |
| Australian Dollar / Chinese RMB / Swiss Francs / Canadian Dollar |
| What is the approximate daily turnover of the FX market? |
| $5-6 trillion ($8+ trillion back in the "hey day") |
| What is the key piece of information needed for incoming wires? |
| Intermediary bank |
| Which hedging products discussed require a FX Line of Credit? |
Forwards & window forwards
|
| USD Data Mining; Leading with FX; RMB LC internal hedging; Cross Border, etc. |
| Name a market that has a high correlation with the pair “USDCAD |
| COMMODITY |
| If a trader is not to beat the market, what/who is the actual target |
| other traders |
| What types of Customers can do RMB payments into/out of China? |
| Business Customers only |
| What is the highest margin FX product? |
Banknotes
| One goal for FX Ops? |
There are 5
| What are the two different rate quotation conventions |
| In Dollar (Direct/American) and Per Dollar (Indirect/European) |
| How does inflation impact FX rates? |
| Higher inflation causes higher interest rate and thus favor the currency to appreciate |
How long do most FX payments take to clear or arrive to the beneficiary bank?
2 business days is market practice
Canada & Mexico is 1 business day
| What are ways that a customer can set up a FX Line of credit? |
| Existing line of credit or cash collateral |
| Give an example of a type of structured FX Exposure Management Program |
| Balance Sheet Hedging; Cash Flow Hedging; Net Investment Hedging |
| How many markets are there for Chinese RMB & what are their currency codes |
|
How do FX transactions clear? Through what types of entities?
Interbank / Bank-to-bank clearing
Name 3 benefits for why customers should do FX payments
1) save on wire fees
2) receive preferred/Elite FX rates
3) hedge their risk by locking rates
4) more transparency
| What is a structured FX Exposure Management Program? |
| A structured hedging program that helps to neutralize the impact of FX G/Ls |
| Who is the "CFO" of the FX team? |
| Norman Siu |