FUTURES CONTRACTS AS A HEDGING TOOL FOR CURRENCY RISK IN UKRAINE
The article discusses the concept, principle and purpose of hedging as an approach to price and currency risk management. The main currency risk hedging instruments are specified. Also the main currency risk hedgers and foreign exchange futures peculiarities have been identified.
The state and dynamics of derivatives market development in Ukraine have been studied. The types of derivatives that are most in demand on exchanges have been identified. The volume and share of derivatives in the traders' exchanges were analysed. The basic prerequisites that have formed the necessity of development of the currency derivatives market in Ukraine are indicated.
Advantages and disadvantages of using foreign exchange futures to minimize enterprises and agricultural producers currency risks have been defined. The main problems impeding the development of the domestic derivatives market and reasons for the low use of hedging instruments in Ukraine have been identified, in particular: lack of investment, reduction in derivatives transactions, underdevelopment of derivatives needed for hedging, insufficient infrastructure for futures trading, low awareness of economic agents of the possibilities of hedging through derivatives transactions, domination of speculative motives.
Based on the derivatives market characteristics in Ukraine, recommendations to expand the monetary market and create conditions for the spread of financial risk hedging have been proposed.
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