transaction exposure

(redirected from Transaction Risks)

Transaction exposure

Risk to a firm with known future cash flows in a foreign currency, that arises from possible changes in the exchange rate. Related: Translation exposure.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Transaction Exposure

In international trade, the risk that exchange rates will change after a company has agreed to a transaction but before it is accomplished, such that it adversely affects the transaction. For example, suppose an American company agrees to buy goods from a British company and settle the transaction in pounds. The American company has the transaction exposure that the pound will appreciate with respect to the U.S. dollar, causing the company to spend more dollars to buy the same number of pounds to be able to settle the transaction.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

transaction exposure

The risk of loss caused by changes in currency exchange rates when a company's payables and receivables are denominated in a foreign currency. Derivatives are used to hedge against changes in currency exchange rates and reduce transaction exposure.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

transaction exposure

see EXCHANGE RATE EXPOSURE.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson
References in periodicals archive ?
Cobalt's Islamic Window, approved by Islamic scholars, draws on the expertise of Shari'ah scholar Sheikh Zubair Miah who reviews and administers the insurance policy enabling the investors to insure transaction risks in full compliance with Shari'ah principles.
"If we concentrated simply on the customer as a whole, we might miss out on getting a deal done." Instead, he's focused on what transaction risks may emerge over the next couple of months, rather than looking at the risk a customer poses over the long term.
Transaction costs are defined as the sum of coordination costs and transaction risks (Williamson, 1981).
The automated fingerprint identification system market is driven by factors such as the need to mitigate transaction risks, growing need for identification, and increase in the frequency of internal and external security threats.
It conducts real-time monitoring on pre-identified transaction areas and flags potential issues and also maps transaction risks with a country risk rating to help identify and prioritise investigation tasks.
When it comes to security, Pang says Shopee addresses common issues faced by users such as fraud, transaction risks, and face-to-face meeting hassles.
Their survey-based findings provide empirical support for the notion that firms employing ORAs seek price competitiveness in their endeavors, yet must take greater steps in the bid preparation process to offset transaction risks and uncertainty.
The ratings agency warned however that high prices and regulatory restrictions on bank ownership would increase transaction risks for potential buyers.
Clark also pointed out that all the folks with good credit are paying down debts, not increasing them, so DOC FCU is re-evaluating other ways to make the credit and transaction risks work for loans to borrowers that aren't A-paper.

Full browser ?