Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • September 2004 (Revised February 2007)
  • Case
  • HBS Case Collection

Hedging Currency Risks at AIFS

By: Mihir A. Desai, Vincent Dessain and Anders Sjoman
  • Format:Print
  • | Pages:17
ShareBar

Abstract

The American Institute for Foreign Studies (AIFS) organizes study abroad programs and cultural exchanges for American students. The firm's revenues are mainly in U.S. dollars, but most of its costs are in eurodollars and British pounds. The company's controllers review the hedging activities of AIFS. AIFS has a hedging policy, but the controllers want to review the percentage of exposure that is covered and the use of forward contracts and options. AIFS sets guaranteed prices for its exchanges and tours a year in advance, before its final sales figures are known. The controllers need to ensure that the company adequately hedges its foreign exchange exposure and achieves an appropriate balance between forward contracts and currency options. To obtain executable spreadsheets (courseware), please contact our customer service department at custserv@hbsp.harvard.edu.

Keywords

Foreign Direct Investment; Investment Funds; Financial Strategy; Forecasting and Prediction; Revenue; Credit Derivatives and Swaps; Currency; Currency Exchange Rate; Education Industry; North and Central America

Citation

Desai, Mihir A., Vincent Dessain, and Anders Sjoman. "Hedging Currency Risks at AIFS." Harvard Business School Case 205-026, September 2004. (Revised February 2007.)
  • Educators
  • Purchase

About The Author

Mihir A. Desai

Finance
→More Publications

More from the Authors

    • Harvard Business Review

    A Better Way to Assess Managerial Performance

    By: Mihir Desai, Mark Egan and Scott Mayfield
    • February 2021
    • Faculty Research

    The Tulsa Massacre and the Call for Reparations

    By: Mihir Desai, Ruth Page, Suzanne Antoniou and Leanne Fan
    • December 2020 (Revised February 2021)
    • Faculty Research

    The Tulsa Massacre and the Call for Reparations

    By: Mihir A. Desai and Suzanne Antoniou
More from the Authors
  • A Better Way to Assess Managerial Performance By: Mihir Desai, Mark Egan and Scott Mayfield
  • The Tulsa Massacre and the Call for Reparations By: Mihir Desai, Ruth Page, Suzanne Antoniou and Leanne Fan
  • The Tulsa Massacre and the Call for Reparations By: Mihir A. Desai and Suzanne Antoniou
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Digital Accessibility
Copyright © President & Fellows of Harvard College