Marking Guidelines:

Structure:

Cover page – Appropriate page format for report

Executive Summary – Should summarize the aims and key findings (5 marks)

Contents Page – Sections and page numbers

Introduction – 1 page introduction to topic (5 marks)

Literature Review – 2 pages summary of journal papers on currency futures (20 marks)

Applications/Case Study/Details of Contracts – Can include an application or general details and discussion. (60 marks)

Conclusions – ½ page conclusion of paper (5 marks)

References – (5 marks)

Table of contents

1. Introduction

2. Literature Review

2.1 The Use of Currency Futures

2.2 Currency Futures Rate as Estimator of Spot Exchange Rate

3. Application

3.1 Trading on Currency Futures Exchanges

3.2 Hedging Foreign Exchange Risk Assuming Perfect Correlation

between Spot and Futures Prices

3.3 Hedging Foreign Exchange Risk Assuming Basis Risk

3.4 Estimation of the Hedge Ratio

4. Conclusion

5. References