Corporations Act 2001
CHAPTER 7
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FINANCIAL SERVICES AND MARKETS
For the purposes of this Chapter, a person manages financial risk if they:
(a) manage the financial consequences to them of particular circumstances happening; or
(b) avoid or limit the financial consequences of fluctuations in, or in the value of, receipts or costs (including prices and interest rates).(a) taking out insurance; or
(b) hedging a liability by acquiring a futures contract or entering into a currency swap.
Note: This Chapter applies to a CCIV in a modified form: see Division 4 of Part 8B.7 .
PART 7.1
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PRELIMINARY
Division 3
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What is a financial product?
Subdivision B
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The general definition
SECTION 763C
763C
WHEN A PERSON
MANAGES FINANCIAL RISK
For the purposes of this Chapter, a person manages financial risk if they:
(a) manage the financial consequences to them of particular circumstances happening; or
(b) avoid or limit the financial consequences of fluctuations in, or in the value of, receipts or costs (including prices and interest rates).
Note 1: Examples of actions that constitute managing a financial risk are:
Note 2: An example of an action that does not constitute managing a financial risk is employing a security firm (while that is a way of managing the risk that thefts will happen, it is not a way of managing the financial consequences if thefts do occur).
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