There is a news story in the New York Times today about Asian airlines and the losses that they are facing because of put options that they had sold against oil prices, months ago, that are now coming due as large costs. They sold these puts to offset the costs of buying calls against oil, where were, in turn, designed to hedge against higher oil prices.
Corporate Hedging: The Down Side
Corporate Hedging: The Down Side
Corporate Hedging: The Down Side
There is a news story in the New York Times today about Asian airlines and the losses that they are facing because of put options that they had sold against oil prices, months ago, that are now coming due as large costs. They sold these puts to offset the costs of buying calls against oil, where were, in turn, designed to hedge against higher oil prices.