Agenda
In this lesson, you'll explore interest rate risk management—a critical area for understanding how businesses protect themselves against fluctuating borrowing and lending costs.
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In this lesson
- 0:00 Interest rate risk management overview
- 0:05 Why businesses face interest rate risk
- 0:11 Gap exposure and liquidity preference theory
- 0:22 Managing risk internally and externally
About this lesson
You'll start by learning why interest rate risk matters to organisations, then move into the core concepts: gap exposure, liquidity preference theory, expectation theory, and market segmentation. The session concludes with practical risk management strategies, covering both internal approaches and external tools like forward rate agreements. This knowledge is essential for FM and AFM papers, where you'll need to evaluate how companies hedge interest rate exposure and optimise their financing decisions.
Duration: 1m
Transcript
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