J-Curve Exposure
J-Curve Exposure

Author: Pierre-Yves Mathonet

Publisher: John Wiley & Sons

Published: 2008-07-31

Total Pages: 476

ISBN-13: 9780470723401

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Building on the success of the author’s previous book Beyond the J Curve:Managing a Portfolio of Venture Capital and Private Equity Funds, this work covers new and additional material and offers advanced guidance on the practical questions faced by institutions when setting up and managing a successful private equity investment programme. Written from the practitioner’s viewpoint, the book offers private equity and venture capital professionals an advanced guide that will make high return targets more realistic and sustainable. Factors that can sometimes cause institutions to shy away from venture capital are the industry’s opaque track record, unclear valuations and risks, perceived lack of transparency as well as the significant entry barriers to overcome before tangible results show. These issues are all addressed in details with practical solutions to the problems. Among other topics J-Curve Exposure includes discussions of: Experiences with the adoption of the International Private Equity and Venture Capital Valuation Guidelines to address fair value under IFRS. Approaches for splitting and prioritizing distributions from private equity funds. Techniques for track record analysis and other tools to help limited partners in their due diligence. Approaches to dealing with uncertainty, the relevance of real options, and co-investments and side funds as advanced portfolio management techniques. Questions related to limited partner decision making fallacies and how to manage portfolios of VC funds. Securitization backed by portfolios of investments in private equity funds. Real life case studies illustrate the issues relevant for the practitioner.

Annual Competitiveness Analysis And Impact Estimation Of Exchange Rates On Exports From Sub-national Economies Of Indonesia
Annual Competitiveness Analysis And Impact Estimation Of Exchange Rates On Exports From Sub-national Economies Of Indonesia

Author: Khee Giap Tan

Publisher: World Scientific

Published: 2019-11-12

Total Pages: 391

ISBN-13: 9811207860

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Indonesia is one of the largest economies in the world and is one of the major players in the global economy. The diversity in Indonesia's socio-economic structure from province to province and region to region warrants an in-depth inquisition at the sub-national level. This book forms part of the series of Asia Competitiveness Institute (ACI) annual flagship study on the competitiveness of the 34 provinces in Indonesia. Using over 100 indicators, the study covers four environments in (1) Macroeconomic Stability, (2) Government and Institutional Setting, (3) Financial, Businesses and Manpower Conditions and (4) Quality of Life and Infrastructure Development, and 12 sub-environments. This book also provides insights to the comparative strengths and weaknesses of the sub-national economies and conducts a 'What-ifs' policy simulation to craft targeted policy recommendations for each province.This sixth edition will continue to elucidate the competitiveness landscape of each province's competitiveness. Additionally, this edition will also feature commentaries by the local academics on the recent developments in the 34 provinces of Indonesia. In view of the importance of international trade to the Indonesia's economy, this book also features the study of impact estimation of exchange rates on exports in Indonesia.

Covered Interest Parity Deviations: Macrofinancial Determinants
Covered Interest Parity Deviations: Macrofinancial Determinants

Author: Mr.Eugenio M Cerutti

Publisher: International Monetary Fund

Published: 2019-01-16

Total Pages: 36

ISBN-13: 1484395212

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For about three decades until the Global Financial Crisis (GFC), Covered Interest Parity (CIP) appeared to hold quite closely—even as a broad macroeconomic relationship applying to daily or weekly data. Not only have CIP deviations significantly increased since the GFC, but potential macrofinancial drivers of the variation in CIP deviations have also become significant. The variation in CIP deviations seems to be associated with multiple factors, not only regulatory changes. Most of these do not display a uniform importance across currency pairs and time, and some are associated with possible temporary considerations (such as asynchronous monetary policy cycles).

Cross-Border Currency Exposures
Cross-Border Currency Exposures

Author: Luciana Juvenal

Publisher: International Monetary Fund

Published: 2019-12-27

Total Pages: 67

ISBN-13: 1513525379

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This paper provides a dataset on the currency composition of the international investment position for a group of 50 countries for the period 1990-2017. It improves available data based on estimates by incorporating actual data reported by statistical authorities and refining estimation methods. The paper illustrates current and new uses of these data, with particular focus on the evolution of currency exposures of cross-border positions.

Foreign Exchange Intervention Rules for Central Banks: A Risk-based Framework
Foreign Exchange Intervention Rules for Central Banks: A Risk-based Framework

Author: Romain Lafarguette

Publisher: International Monetary Fund

Published: 2021-02-12

Total Pages: 33

ISBN-13: 1513569406

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This paper presents a rule for foreign exchange interventions (FXI), designed to preserve financial stability in floating exchange rate arrangements. The FXI rule addresses a market failure: the absence of hedging solution for tail exchange rate risk in the market (i.e. high volatility). Market impairment or overshoot of exchange rate between two equilibria could generate high volatility and threaten financial stability due to unhedged exposure to exchange rate risk in the economy. The rule uses the concept of Value at Risk (VaR) to define FXI triggers. While it provides to the market a hedge against tail risk, the rule allows the exchange rate to smoothly adjust to new equilibria. In addition, the rule is budget neutral over the medium term, encourages a prudent risk management in the market, and is more resilient to speculative attacks than other rules, such as fixed-volatility rules. The empirical methodology is backtested on Banco Mexico’s FXIs data between 2008 and 2016.

Dominant Currency Paradigm: A New Model for Small Open Economies
Dominant Currency Paradigm: A New Model for Small Open Economies

Author: Camila Casas

Publisher: International Monetary Fund

Published: 2017-11-22

Total Pages: 62

ISBN-13: 1484330609

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Most trade is invoiced in very few currencies. Despite this, the Mundell-Fleming benchmark and its variants focus on pricing in the producer’s currency or in local currency. We model instead a ‘dominant currency paradigm’ for small open economies characterized by three features: pricing in a dominant currency; pricing complementarities, and imported input use in production. Under this paradigm: (a) the terms-of-trade is stable; (b) dominant currency exchange rate pass-through into export and import prices is high regardless of destination or origin of goods; (c) exchange rate pass-through of non-dominant currencies is small; (d) expenditure switching occurs mostly via imports, driven by the dollar exchange rate while exports respond weakly, if at all; (e) strengthening of the dominant currency relative to non-dominant ones can negatively impact global trade; (f) optimal monetary policy targets deviations from the law of one price arising from dominant currency fluctuations, in addition to the inflation and output gap. Using data from Colombia we document strong support for the dominant currency paradigm.