1. Abhishek Kumar
Jaipuria ,Indore

2. corporate membership in National Stock Exchange Ltd,
Bombay Stock Exchange Ltd. and Central Depositories
Securities Ltd.
 BMA Commodities Limited -
corporate membership in commodities exchange of NCDEX
and MCX. It is also is SEBI approved AMFI registered
Mutual Fund advisory and intermediary.
A premier financial services organization providing individual and corporates with
customized financial solutions.

4. • Largest Financial
market
• 24-hr market
• Average daily trade –
over US $ 3.5 trillion

5. World traded currency – Dollar
 Investment currency in capital markets.
 Reserve currency of Central Banks.
 Transaction currency in many commodity
markets.
 Invoice currency for many contracts.

6.  Demand & Supply Forces
 Dollar against major currencies like Euro, Pound, Yen
 Global Asian Stock markets
 Indian Stock markets
 Economic factors
 Government budget deficits
 Interest rates
 Inflation
 Fiscal and Monetary Policy
 BOP

7.  Banks
 Importers & Exporters
 Corporate
 Individual
View on appreciation or
depreciation of USD/INR

8. Indian rupees per currency unit averaged over the year
currency code 1996 2000 2004 2006 2009 2010 2011
U.S. dollar USD 35.444 44.952 45.340 43.954 48.76112 45.3354 51.22
Canadian dollar CAD 26.002 30.283 34.914 41.098 42.92026 44.5915 52.1706
Euro* EUR 44.401 41.525 56.385 64.127 68.03312 60.5973 65.6987
Pound sterling GBP 55.389 68.119 83.084 80.633 76.38023 71.3313 83.6329
Swiss franc CHF 28.714 26.654 36.537 40.451 45.05846 45.9957 57.3525
Australian dollar AUD 27.761 26.157 33.409 36.972 38.58082 43.9854 53.9759
Japanese yen JPY 0.5555 0.41711 0.41945 0.42627 0.52239 0.545447 0.6907
Singapore dollar SGD 25.160 26.079 26.830 30.932 33.60388 34.5127 41.2737
*before Jan 1, 1999, European Currency Unit, code XEU

10. Case 1. Exporter earns goods worth USD 1,00,000 on
10th May & payment expected in JULY 2012.
Spot Rate on 10th may INR 55.41 USD
Amount payable on 10th may 55,41,000
Buy 3 months future contracts
Futures price = spot + Cost of carry USD 55.72 (55.41+0.31)
Future price in INR Rs . 55,72,000
Spot rate on 10th July 12 INR 57.97 per USD
If not hedged payment would Rs. 57,97,000
Saving due to hedging Rs. 2,25,000

11.  Exporter earning USD 1,00,000 for JULY 10, expecting
remittance on 10 JULY 2012
Spot rate on 30th may INR 53.46 per Dollar
Sell 1000 USDINR contracts JULY
Futures Price = Spot+ Cost of Carry INR 53.46 per USD (53.46+0.25)
Rs 53,71,000
Spot Rate on 10 JULY 12 INR 54.46 per USD(54.46+0.25)
Rs 54,71,000
If not hedged receipt would be Rs 54,46,000
Loss due to hedging Rs 75,000

14.  Derivatives are the financial instruments which derive
their value from the value of the underlying asset.
 The underlying asset can be equity, fixed income
instruments, interest rates, foreign exchange or
commodities.
 The price movements of derivative products are
related to that of the underlying securities.

16. Hedging:
Speculation:
•Interest rate volatility
•Stock price volatility
•Exchage rate volatility
•Commodity prices volatility
VOLATILITY
•High portion of leverage
•Huge returns
EXTREMELY RISKY

17. A futures contract is a contract that allows the
counterparties to exchange the underlying assets in
future at a price agreed upon today. Following are the
features of a futures contract-
 Contract through an exchange
 To exchange obligations on a future date
 At a price decided today
 For a quantity standardized by the exchange
 Settlement guaranteed by the clearing corporation of
the exchange

18.  Short Position: • Short selling is the selling of a currency
that the seller does not own.
• Short sellers assume the risk that they will
be able to buy the currency at a more
favorable price than the price at which
they sold short.
Long Position:
• Long selling is the selling of a currency
that the seller does own.
• Long sellers assume the risk that that they
won‘t be able to buy the currency at a more
favorable price than the price at which
thay sold long

19.  If you are going to sell something in the near future
but want to lock in a secured price, you take a short
position.
 If you are going to receive/buy something in the
future but want to lock in a secured price, you take a
long position.

20.  Expansion of the Market.
 Unawareness about the Hedging in the market
through exchange.
 About the business and revenue model of brokerage
companies in this field.
 The norms that exist in the trade between two
currencies.
 Number Game