Chapter 11 Contents 11.1 Using Forward Futures 11.6 Basic Features of Insurance Contracts to Hedge Risks Contracts 11.2 Hedging Foreign-Exchange 11.7 Financial Guarantees Risk with Swap Contracts 11.8 Caps Floors on Interest 11.3 Hedging Shortfall-Risk by Rates Matching Assets to Liabilities 11.9 Options as Insurance 11.4 Minimizing the Cost of 11.10 The Diversification Hedging Principle 11.5 Insuring versus Hedging 11.11 Insuring a Diversified Portfolio THE COURSE OF FINANCE 2017 SPRING SJTUChapter 11 Contents 11.1 Using Forward & Futures Contracts to Hedge Risks 11.2 Hedging Foreign-Exchange Risk with Swap Contracts 11.3 Hedging Shortfall-Risk by Matching Assets to Liabilities 11.4 Minimizing the Cost of Hedging 11.5 Insuring versus Hedging 11.6 Basic Features of Insurance Contracts 11.7 Financial Guarantees 11.8 Caps & Floors on Interest Rates 11.9 Options as Insurance 11.10 The Diversification Principle 11.11 Insuring a Diversified Portfolio THE COURSE OF FINANCE 2017 SPRING SJTU 2