FIN366 UOPX Financial Transaction Risks Resources: Student Website, Financial Transactions Risk Table, and Financial Transactions Risk Table Assignment Gra

FIN366 UOPX Financial Transaction Risks Resources: Student Website, Financial Transactions Risk Table, and Financial Transactions Risk Table Assignment Grading Guide.

There are two deliverables for this assignment. You will fill out and submit the Financial Transactions Risk Table and you will write and submit a 1,050- to 1,400-word paper.

Address the following in your paper:

Describe risk exposures by filling out the Financial Transaction Risks Table.
Describe features you would choose to measure interest risks and identify which transactions are influenced by interest rates or income. Some are influenced by both.

Format your paper consistent with APA guidelines.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document(s). Week 3: Learning Team Assignment: Financial Risks
FIN/366 Version 2
University of Phoenix Material
Week 3 Learning Team Assignment: Financial Transaction Risks
Describe the risk exposure(s) in the following financial transactions.
Identify which transactions are influenced by interest rates or interest income. (CAUTION: Some can be influenced by
both!)
Risk Types: Interest rate risk, Credit risk, Technology risk, Foreign exchange rate risk, Country, or sovereign risk
Financial Transactions
A bank finances a $10 million, six-year fixed-rate
commercial loan by selling one-year certificate of
deposit.
An insurance company invests its policy premiums in
a long-term municipal bond portfolio.
A French bank sells two-year fixed-rate notes to
finance a two-year fixed-rate loan to a British
entrepreneur.
A Japanese bank acquires an Austrian bank to
facilitate clearing operations.
A bond dealer uses his own equity to buy Mexican
debt on the less developed country (LDC) bond
market.
A securities firm sells a package of mortgage loans as
Risk
Type
Describe and justify risk type
Interest
Rate or
Interest
Income?
1
Week 3: Learning Team Assignment: Financial Risks
FIN/366 Version 2
mortgage-backed securities.
Describe the features of the method you would choose to measure the interest risks identified.
2

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