How To Fix TEM_MESSAGES_AL418 - Minimum hedge ratio is greater than the target ratio

SAP Error Message - Details

• Message type: E = Error

• Message class: TEM_MESSAGES_AL - Messages for TEM-AL Layer

• Message number: 418

• Message text: Minimum hedge ratio is greater than the target ratio

Self-Explanatory Message

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Smart SAP Assistant

• What is the cause and solution for SAP error message TEM_MESSAGES_AL418 - Minimum hedge ratio is greater than the target ratio ?

  The SAP error message TEM_MESSAGES_AL418 indicates that the minimum hedge ratio specified in your hedging configuration is greater than the target hedge ratio. This situation typically arises in the context of financial hedging within SAP, particularly in modules related to treasury and risk management.
  Cause:
  
  Configuration Mismatch: The minimum hedge ratio is set higher than the target hedge ratio in the hedging settings. This can happen due to incorrect configuration or misunderstanding of the required ratios.
  Data Entry Error: There may have been an error in entering the hedge ratios in the system, leading to this inconsistency.
  Business Logic: The business logic or rules defined for hedging may not align with the actual financial strategy or requirements.
  
  Solution:
  
  
  Review Hedge Ratios: Check the configuration settings for the hedge ratios in the SAP system. Ensure that the minimum hedge ratio is less than or equal to the target hedge ratio.
  
  Navigate to the relevant configuration settings in the SAP system (usually found in the Treasury module).
  Adjust the minimum hedge ratio if necessary.
  
  
  
  Correct Data Entry: If the ratios were entered incorrectly, correct them in the relevant transaction or configuration screen.
  
  
  Consult Documentation: Review the SAP documentation or guidelines related to hedging to ensure that the ratios are set according to best practices and business requirements.
  
  
  Engage with Stakeholders: If there is confusion about what the correct ratios should be, consult with financial analysts or stakeholders involved in the hedging strategy to clarify the intended ratios.
  
  
  Testing: After making adjustments, test the changes in a development or test environment to ensure that the error is resolved and that the hedging functionality works as expected.
  
  
  Related Information:
  
  Hedging in SAP: Understand the concepts of hedging, including how hedge ratios are calculated and their significance in risk management.
  SAP Notes: Check for any relevant SAP Notes or updates that might address this specific error or provide additional guidance.
  Training and Documentation: Consider training for users involved in treasury and risk management to ensure they understand how to configure and manage hedge ratios effectively.
  
  By addressing the configuration or data entry issues leading to this error, you should be able to resolve the TEM_MESSAGES_AL418 message and proceed with your hedging activities in SAP.