You have successfully passed the pre-employment assessment and have been invited to attend an interview. You have been informed that during the interview you will be asked to discuss how you would deploy risk management strategies by using derivatives instruments by presenting specific financial risk management scenarios as follows.

Q1

This year, the RH Recruitment Manager has selected the leading blue chip Australian companyBHPas a test case study for all candidates who will apply for the Junior Financial Risk Manager role at BHP. Consider the recent BHP announcement of its intention to create global top 10 independent energy company through amerger of BHP's petroleum business with Woodside. Discuss one likely scenario by outlining usage of derivative instruments in the next 12 months. (From the perspective of BHP's financial risk)

Q2

Financial risk management scenario for BlackRock or Vanguard

You are applying for the Junior Financial Risk Manager role at eitherBlackRock AustraliaorVanguard Australia. Both fund managers have large shareholder cohorts in the leading blue chip Australian companyFortescue Metals Group(Fortescue or FMG). Recently, the Chairman of Fortescue, Dr Andrew Forrest, has announced that his company will create green hydrogen industries. Based on recent financial news and articles in the press, discuss one likely scenario and outline usage of derivative instruments in the next 12 months. Your role is to ensure that the selected fund manager, either BlackRock or Vanguard, stays competitive. (from the perspective of fund management companies)

Answer rating: 100% (QA)

Q1 Scenario for BHP BHP Billiton Limited In the scenario of BHPs intention to create a global top 10 independent energy company through a merger of its petroleum business with Woodside one likely risk ... View the full answer