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COVER
STORY
Hedge
Funds: A Closer Look
- - KV Saraswathi
Hedge
funds are considered to be the major source of innovations
in the global financial markets. They provide significant
liquidity to the market and improve market stabilization
through efficient price discovery mechanism. However,
of late, they have been held responsible for major financial
scandals. This article discusses relevant issues.
©
2006 IUP . All Rights Reserved
COVER
STORY
Hedge
Funds: Is India their Next Destination?
- - Seema Agrawal
Retail
investors faced turbulence whenever the capital market
suddenly experienced a deep fall due to manipulation
by the big market players. This article, examines what
hedge funds are all about and their functioning and
looks into the role hedge funds are playing and likely
to play in the Indian financial market.
©
2006 IUP . All Rights Reserved
TREASURY
Repo
Rates : A Weapon to Fight Liquidity Crisis
- - Vunyale Narender , Sheetal Todarwal
In
India, the financial liberalization policies were initiated
in the year 1991. With the onset of the financial liberalization
process, there have been many challenges that have emerged
out of the dynamics of the economy. In the backdrop
of liquidity crisis, one of the factors that lead to
variation in the inflation and other macroeconomic indicators
i.e., the role of the RBI to maintain stability among
the factors affecting liquidity becomes quite significant.
©
2006 IUP . All Rights Reserved
RISK
Credit
Derivatives: The Time Bomb Ticks
- - Mallikarjunan
A
credit derivative is a financial instrument intended
to transfer the risk of the total return in a credit
transaction by hedgers and speculators. These products
are useful for institutions with widespread credit exposures
and are believed to herald a new era in international
banking, where banks are very much exposed to diversified
credit risk as compared to other lenders.
©
2006 IUP . All Rights Reserved
RISK
The
World of Catastrophe Risks
- - Jayashree Bose
All
exposures are risky, but some, like catastrophe exposures,
are more risky than others. This slightly revamped version
of the Orwellian truth seems to have gone down well
with many catastrophe insurers, who are trying to manage
their risks with ingenuity. Prime on their risk management
agenda are decisions on how much risk to take, at what
price to take them, estimating risk, limits to risk,
managing claims risk and avenues for transferring risk.
The article gives an insight into how insurers take
these decisions.
©
2006 IUP . All Rights Reserved
FOREX
Indias
External Sector in International Perspective
- - Badar Alam Iqbal
During
the mid-1980s, when a phenomenal growth was witnessed
in private capital flows to developing economies, India
was not among the favored destinations of private foreign
investors. With the reforms of 1991, continuous efforts
were made towards integrating India with the world economy
and attracting private capital.
©
2006 IUP . All Rights Reserved
FOREX
Exchange
Rate Management and Current Account Sustainability in
India
- - Saji Kumar
In
the context of globalization and currency crises, a
pertinent question that policy makers debate over is
whether a country should choose a fixed or a flexible
exchange rate, or some intermediate regime. In India,
as a consequence of the balance of payments crisis that
precipitated in 1991, the managed exchange rate float
system was strengthened by making the rupee fully convertible
in 1994 for the entire current account transactions
.
©
2006 IUP . All Rights Reserved
FOREX
Indian
Rupee: The Two Devaluations
- - TR Shastri
Rupee
was devalued for the first time in 1966, though its
external value was subjected to change quite often.
Exactly after 25 years, the second set of devaluations
took place. But the purpose and the consequences were
different. This article reviews the two events on the
40th anniversary of the first of the two events.
©
2006 IUP . All Rights Reserved
SPEECH
Globalization
and its Implications for Monetary Policy
- - Krzysztof Rybinski
©
2006 Bank for International Settlements (BIS) Quarterly
Review April 2006. Reprinted with permission. Speech
by Krzysztof Rybinski, Deputy President of the National
Bank of Poland, at a series of seminars by the Centre
for European Regional and Local Studies and the UNESCO
Chair, Warsaw University, Warsaw, April 6, 2006. |
