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Case
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Reference no. 9B00N027
Published by: Ivey Publishing
Originally published in: 2000
Version: 2000-12-05
Length: 24 pages
Data source: Field research

Abstract

The financial uncertainty in Hong Kong and Asia from mid-1997 to mid-1998 was caused in part by the ''Asian flu'' and the return of Hong Kong to the People''s Republic of China. A large North American-based insurance company was faced with the decision of managing its Asian assets in light of this uncertainty, especially the possible breaking of the peg between the Hong Kong dollar and the US dollar. As the vice-president of capital markets at Manulife Financial contemplated what strategy he would recommend to the senior executive group, he considered the concepts of fixed/pegged exchange rates and the use of different strategies to manage the risks, as well as the potential profit opportunities that may arise when a fixed/pegged exchange rate is under attack and may break.
Location:
Size:
Large
Other setting(s):
1998

About

Abstract

The financial uncertainty in Hong Kong and Asia from mid-1997 to mid-1998 was caused in part by the ''Asian flu'' and the return of Hong Kong to the People''s Republic of China. A large North American-based insurance company was faced with the decision of managing its Asian assets in light of this uncertainty, especially the possible breaking of the peg between the Hong Kong dollar and the US dollar. As the vice-president of capital markets at Manulife Financial contemplated what strategy he would recommend to the senior executive group, he considered the concepts of fixed/pegged exchange rates and the use of different strategies to manage the risks, as well as the potential profit opportunities that may arise when a fixed/pegged exchange rate is under attack and may break.

Settings

Location:
Size:
Large
Other setting(s):
1998

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