In: Accounting
Consider the two articles about Apple Inc.’s hedging policy.
"An extremely well-timed currency hedging regimen saved Apple Inc. about 70 cents a share — or $4.1 billion — in earnings during fiscal year 2015, analysts…said…”
Explain what this hedging regimen was and why it saved Apple Inc. so much money. Under this hedging regime what would have happened to Apple profits if the dollar had depreciated significantly instead of appreciating from mid-2014 to the end of 2015?