{"product_id":"risk-management-in-uk-banking-the-role-of-derivatives-hedging-in-particular-von-dimitar-vasilev","title":"Risk  Management In UK Banking - The Role Of Derivatives Hedging In Particular","description":"\u003cp\u003eThesis (M.A.) from the year 2010 in the subject Economics - Finance, grade: 2,0, University of Portsmouth, language: English, abstract: Risk management has been pivotal banking activity, particularly for the last 20 years. Volatile\u003c\/p\u003e\u003cp\u003eeconomic conditions and ever¿growing competitive forces have compressed profit margins and\u003c\/p\u003e\u003cp\u003eforced UK banks to look up to sophisticated and more comprehensive methods of identifying optimal\u003c\/p\u003e\u003cp\u003erisk¿return positions. Advanced technology and global business focus has presented opportunities to\u003c\/p\u003e\u003cp\u003eutilize comprehensive quantitative techniques to contain and manage risk exposure. Technology has\u003c\/p\u003e\u003cp\u003eplayed crucial role in establishing and dispersing electronic trading platforms giving access to equity\u003c\/p\u003e\u003cp\u003eand derivatives hence reshaping capital acquisition and risk management frameworks. The topic of\u003c\/p\u003e\u003cp\u003erisk management has been even more contextual in times of severe economic\/financial crisis.\u003c\/p\u003e\u003cp\u003eAnalysts have not only been critical of banks¿ uncollateralized lending but also of their excessive\u003c\/p\u003e\u003cp\u003etrading with derivative instruments. Assuming that no arbitrage opportunities exist, the question\u003c\/p\u003e\u003cp\u003eremains as to whether banks attempt to hedge their risk exposure or purely speculate on the\u003c\/p\u003e\u003cp\u003edirection of price movements. In this context, central task of this dissertation is to examine the role\u003c\/p\u003e\u003cp\u003ederivative instruments play in the UK banking system through aggregately assessing risk position of\u003c\/p\u003e\u003cp\u003elargest UK banks relative to aggregate trading volumes. Empirical analysis is conducted utilizing a\u003c\/p\u003e\u003cp\u003etwöstage SUR technique. Results from first stage of empirical analysis confirm that risk premium on\u003c\/p\u003e\u003cp\u003ebanks¿ equity securities is strongly related to market risk premium. More importantly, findings\u003c\/p\u003e\u003cp\u003eillustrate that exchange rate exposure of UK banks has more significant impact on stock returns\u003c\/p\u003e\u003cp\u003ecompared to interest rate risk exposure. Second stage of the analysis fails to provide comprehensive\u003c\/p\u003e\u003cp\u003econclusion due and produces controversial results. Nevertheless, exchange rate derivatives are found\u003c\/p\u003e\u003cp\u003eto have impact on exchange rate risk albeit only marginally\u003c\/p\u003e\u003cdiv class=\"aw-variant-hidden-subtitle-div\" id=\"aw-variant-subtitle-9783656035572\"\u003e\u003ch3\u003e\u003c\/h3\u003e\u003c\/div\u003e","brand":"Libri","offers":[{"title":"Softcover - 9783656035572","offer_id":39445547122781,"sku":"9783656035572","price":29.95,"currency_code":"EUR","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0940\/0622\/files\/04a64004-f20f-488c-912e-e6ae39d0bfd2.jpg?v=1777871798","url":"https:\/\/shop.autorenwelt.de\/en\/products\/risk-management-in-uk-banking-the-role-of-derivatives-hedging-in-particular-von-dimitar-vasilev","provider":"Autorenwelt Shop","version":"1.0","type":"link"}