Students are requested to critically address the following points:
• Describe the US$/Euro exchange rate dynamics all through the 2019-2021 timespan: what explains this trend?
• Assuming you were a European trader, explain how straddles and strangles could have been used to hedge a long USD-denominated position held in Jan 2020. Please, support your claims with a preliminary theoretical overview followed by a practical example (25 points)
• Describe the GBP/Euro exchange rate dynamics all through the 2016-2021 timespan: what explains this trend?
• Assuming you were a European trader, explain how futures contracts could have been used to hedge a long GBP-denominated position in the aftermath of the Brexit referendum. Please, support your claims with a preliminary theoretical overview followed by a practical example (Hint: do not forget the daily Mark-to-Market procedure) (25 points)
• Assess the effectiveness ultra-expansionary fiscal and monetary policies, with particular attention to highly indebted countries like Italy: as a bond trader, describe how interest rates dynamics and bond duration/convexity are all intertwined. Support your analysis with a practical example and do not forget to refer to the theoretical framework discussed in class (25 points)
• On the background of what you have described above, try to assess which countries, sectors or asset classes you would recommend (or NOT recommend) to portfolio managers for the next 12 months (25 points)
Format of the report:
- The report should display a coherent structure: title page should include student name, module name, lecturer name, date and school name followed by contents page, introduction, executive summary, methodology, findings, analysis, conclusions, recommendations, referencing and appendices.
- The report should be prepared as a neatly typed Word document (Times New Roman 12 points), with double spacing and page numbering.
- All reports will be discussed in class in a power point presentation of no more than 20 minutes. The presentation should be a summary of your work.
- Tables or work/data taken from other sources may be included in an appendix.
- All sources must be referenced in the text and a full bibliography must be provided (including visited websites) in the Harvard style referencing system. Paraphrasing or direct quotes taken from other sources must be clearly indicated with citations. No footnoting!
- Students are reminded that depth, relevance and variety are the crucial elements of quality research. (Wikipedia is not considered to be a relevant source of information; any students referencing Wikipedia will be deducted marks! Alternatively, if you find information on Wikipedia use the original sources listed at the bottom of the article)
- Students are reminded to use valid and peer-reviewed references to support their work. Websites should only be used if they represent an established source and only for facts and figures. Students should make the most of academic and practitioner books and articles.
- Submission should be by the deadline below on Turnitin.com.
- All work must conform to University regulations on Cheating, Collusion and Plagiarism’ as described in your program handbook. You are advised to use the Harvard referencing style and avoid plagiarism.
Type of service: Academic paper writing
Type of assignment: Research Paper
Number of sources: 15
Academic level: Master’s
Paper format: Harvard
Line spacing: Double
Language style: UK English