Question: As a future financial manager in an MNC, explain why you need to use financial derivatives listed below. Put option When do we buy put

  • As a future financial manager in an MNC, explain why you need to use financial derivatives listed below.
  1. Put option
  1. When do we buy put option?
  1. How do we use the put option to hedge against the foreign exchange rate fluctuations?
  1. Straddle
  1. When do we create straddle strategy?
  1. How do we (as holder) use the straddle to speculate against the foreign exchange rate fluctuation?

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