Unit of competency Outline

Date retreived
24/07/2026 1:47 AM AWST

Whilst all efforts are made to provide accurate and timely information from the relevant source/documentation, please be aware that the information supplied may not be the most current version. The accuracy of the detail has not been confirmed by the Department and therefore should not be relied upon without first confirming the contents.

Manage trading exposures

Manage trading exposures

Unit of competency
National Code
FNSFMK612
State Code
OBR77
TGA Status
Current
DTWD Status
Approved
Current Release Number
1.00
Current Release Date
01/07/2020
View on TGA
State Implementation and Classification
Approved Date
02/10/2020
Field of Education
080101 - Accounting
Original Release Date
02/10/2020
Nominal Hours
70
Description
This unit covers the skills and knowledge required to manage financial risk, arising as a result of client transactions. It involves assessing existing exposures and risk appetite and then developing strategies to minimise, prevent and mitigate financial risk.The unit applies to individuals who use analytical skills and systematic approaches to assess, review and manage trading exposures.No licensing, legislative or certification requirements apply to this unit at the time of publication.
Notes
Elements and Performance Criteria
1. Assess risk and determine need for hedging
  • 1.1 Review existing trading portfolio and risk appetite to determine if hedging is required
  • 1.2 Assess risks of various underlying hedge transactions including outright risk and basis risk
2. Develop and execute hedging strategies to mitigate risk
  • 2.1 Formulate appropriate hedging strategy to mitigate risk, in line with market conditions and organisational hedging policies
  • 2.2 Confirm hedge is within own authority to transact and within own existing market risk limit structure as a market maker
  • 2.3 Determine most appropriate venue for executing hedge transaction
  • 2.4 Execute hedging strategy in accordance with organisational, industry standards and regulatory requirements.
  • 2.5 Identify and report trading breaches in compliance to organisational processes
3. Review adjusted risk position and develop strategies to minimise risks
  • 3.1 Assess post-transaction portfolio for inclusion of both original transaction and any subsequent hedges
  • 3.2 Assess if position is within organisational risk tolerance and adjusted for changing market conditions
No information
No information
Replaces
State Code National Code Title Type
AUR17 FNSFMK602 Hedge financial products Unit of competency