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Hedging Interest-Rate Risks For Lessors
By George A. Hachey, Ph.D. and James M. Johnson, Ph.D
Fall 1984

The level and volatility of interest rates has increased dramatically over the past fifteen years, causing lessors to explore and implement new methods of protecting profit margins. This article examines tools which can be used to protect profit margins of businesses subject to variable interest rates, and evaluates their usefulness to lessors. The two asset mechanisms evaluated are variable rate leases and variable lease maturities. Liability management tools examined include financial futures and interest rate swaps.

<span style=\"font-weight: bold;\">Hedging Interest-Rate Risks For Lessors</span><br style=\"font-weight: bold;\" /><span style=\"font-weight: bold;\">By George A. Hachey, Ph.D. and James M. Johnson, Ph.D</span><br style=\"font-weight: bold;\" /><span sty