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Financial Derivatives

C/F/1370. Dissertation. The theory and practice of hedging in financial risks. Case studies: Lloyds banking group and British Petroleum

WORDS:

10250

DATE:

2012

PRICE:

109.99 GBP

This dissertation discusses the theory and practice of hedging in financial risks. The objectives are to critically examine the different types of hedging techniques and how they are practically utilised, to determine the nature of transactions for which hedging is utilised and the common types of hedging techniques that are used in hedging financial transactions, and to critically examine the prevalence of hedging among a sample of FTSE 100 companies and how this is applied practically as opposed to theory. The review of literature discusses a range of topics, some of which include taxation benefits, reduction in agency costs, and different hedging tools and techniques. The methodology is then provided, which details the data collection methods used for the study. Lloyds banking group and British Petroleum (BP) are used as case studies, and the paper details the forms of hedges used by these organisations. The study carries out an analysis of the results from the data collection methods, and evaluates them in detail.

KEYWORDS: Dissertation, hedging, financial risk, FTSE 100, taxation benefits, agency costs, British Petroleum, Lloyds banking group,