Question: What are the differences between a microhedge and a macrohedge for an FI? Why is it generally more efficient for FIs to employ a macrohedge

What are the differences between a microhedge and a macrohedge for an FI? Why is it generally more efficient for FIs to employ a macrohedge than a series of microhedges?

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A microhedge uses a derivative contract such as a forward or futures contract to hedge the risk ex... View full answer

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