List the assessment methods to be used and the context and resources required for assessment. Copy and paste the relevant sections from the evidence guide below and then re-write these in plain English.
ELEMENT | PERFORMANCE CRITERIA |
Elements describe the essential outcomes. | Performance criteria describe the performance needed to demonstrate achievement of the element. |
1. Assess hedge financial transaction | 1.1 Assess risk tolerance and appetite, and review current financial position to determine if hedging is required using an additional financial product 1.2 Analyse hedging instrument options based on limits, organisational product approvals and current exposure assessment |
2. Complete hedge transaction | 2.1 Undertake hedge transaction with counterparties in accordance with organisational guidelines, credit and other desk limits 2.2 Collect hedge transactional details, complete relevant documentation and enter hedge transaction into the organisation’s dealing system 2.3 Report details of transaction to authorised trade repository where required by regulation |
3. Assess adjusted financial position | 3.1 Assess new post-transaction position in line with profit and loss and risk reports, and new market data available 3.2 Adjust hedge position, based on analysis of new data, if risk remains outside scope of organisational tolerance or market moves 3.3 Collect additional transactional details, complete relevant documentation and enter new transaction into organisation’s dealing systems |
Evidence of the ability to:
complete hedge financial transactions and enter into organisational systems
evaluate and adjust financial positions
interpret and comply with organisational trading rules and limits.
Note: If a specific volume or frequency is not stated, then evidence must be provided at least once.
To complete the unit requirements safely and effectively, the individual must:
compare and contrast financial risk analysis techniques
analyse and describe financial market reports, including profit and loss reports
describe the key features of organisational requirements relating to financial trading
identify and classify organisational transactions limits
assess the impact of the following key economic features when hedging financial products:
characteristics and impacts of economic and business cycles
monetary and fiscal policies
interest rates, exchange rates and inflation
compare and contrast the range of financial market products available.
Assessment must be conducted in a safe environment where evidence gathered demonstrates consistent performance of typical activities experienced in the financial markets field of work and include access to:
office equipment, technology, software and consumables
financial services product information
dealing system and data.
Assessors must satisfy NVR/AQTF assessor requirements.