Lecture22 Managing Risk(公司金融讲义(北大).pdf

Principles of Corporate Finance 22. Managing Risk Seventh Edition Richard A. Brealey Stewart C. Myers Slides by Matthew Will Slides Edited by Minggao Shen 22- 2 Topics Covered Insurance Hedging With Futures Forward Contracts SWAPS How to Set Up A Hedge McGraw Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved 22- 3 Insurance Most businesses face the possibility of a hazard that can bankrupt the company in an instant. These risks are neither financial or business and can not be diversified. The cost and risk of a loss due to a hazard, however, can be shared by others who share the same risk. McGraw Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved 22- 4 Insurance Example An offshore oil platform is valued at $1 billion. Expert meteorologist reports indicate that a 1 in 10,000 chance exists that the platform may be destroyed by a storm over the course of the next year. ? How can the cost of this hazard be shared McGraw Hill/Irwin Copyright © 2003 by The McGraw-Hill Companies, Inc. All rights reserved 22- 5 Insurance Example - cont An offshore oil platform is valued at $1 billion. Expert meteorologist reports indicate that a 1 in 10,000 chance exists that the platform may be destroyed by a storm over the course of the next yea