Definition for : Natural hedge
GLOSSARY LETTER
Natural hedge consists in creating conditions in which an Exposure to a Risk is Offset or partly Offset by an opposite Exposure to that same Risk (for example, shifting Production facilities, Working capital, or borrowing arrangements to an alternative currency area to Offset undesirable Cash flow Exposures). See also Self-hedging.
(See Chapter 49 Managing working capital of the Vernimmen)
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