Article Review
Executive summary
Since the 2008 recession—when financial instability resulted in the losses and insolvency of several banks and firms—there is an increased cautiousness about international investments and lending experiences in not just the emerging-market countries, but in any foreign soil. This article discusses the use of bonds by firms investing in international markets to avoid the adversities caused by exchange-rate fluctuations. While foreign-exchange risk is still being hedged by currency swaps and futures contracts, bonds in the local currency are being used increasingly by investing companies. They use the cash flow generated from the sales in ...