Know the instrument.
Understand the exposure.

01 / INTEREST RATES

From borrowing costs to yield curves.

Futures, options and swaps can change exposure to interest rates. A fixed-for-floating swap exchanges cash flows under an agreed schedule; it does not exchange a stock of principal in a standard single-currency structure.

Who studies this exposure?

Corporate treasury teams, lenders and asset managers.

Questions to investigate

Curve shifts, duration mismatch, basis, liquidity and counterparty risk.

A simple price-difference tool does not model bond duration, swap valuation or nonlinear yield changes.

02 / EQUITY & VOLATILITY

Separate direction from payoff shape.

Index futures offer linear exposure. Options create payoffs that depend on strike and the underlying price at expiry; their value before expiry also depends on time and volatility.

Who studies this exposure?

Portfolio managers and institutions managing market exposure.

Questions to investigate

Leverage, gaps, volatility changes, assignment and liquidity.

The option tool models expiry only. It is not a pricing engine or a strategy recommendation.

03 / FOREIGN EXCHANGE

Currency exposure has a time dimension.

Forwards can fix a future exchange rate; FX swaps combine an exchange today with a reverse exchange later. Contract conventions, collateral and settlement arrangements matter.

Who studies this exposure?

Businesses with cross-border revenues, costs or financing.

Questions to investigate

Settlement, tenor mismatch, funding, counterparty and basis risk.

Currency pairs, day-count conventions and settlement mechanics require specific modelling.

04 / COMMODITIES

Connect physical activity to financial exposure.

Energy, agricultural and metals derivatives reference distinct products, delivery locations and maturities. A financial hedge may behave differently from the physical exposure it is intended to offset.

Who studies this exposure?

Producers, processors, utilities and industrial consumers.

Questions to investigate

Location and quality basis, delivery obligations, seasonality and changing liquidity.

Our generic futures tool does not model physical delivery, storage or a hedge effectiveness test.