"Hedging Foreign Currency Exposure in International Transactions"

This presentation will address the foreign currency risk companies face in transacting internationally and how this currency risk can be managed with a tailored hedging strategy.  Currency fluctuations can range 5% to 10% over any six-month period due to a variety of political, economic and other factors.  Broad realignments in the international order like Brexit put long term pressure on a country’s currency and one-time shocks such as the Swiss Central Bank’s abandoning its support of the Euro peg cause dramatic and unpredictable drops.  It’s important to know these risks and to take measures to protect against currency volatility.  Various hedging tools such as forward contracts, window forwards, market orders, and holding accounts will be defined.  These tools, used individually or in combination, can mitigate the risk of currency fluctuation that can negatively impact a company’s bottom-line.  To illustrate how hedging tools actually work several client case studies will demonstrate how a conservative hedging strategy can reduce foreign currency risk.

The presentation will conclude with a snapshot of how some of the new technologies such as block chain, crypto currencies and Artificial Intelligence (AI) may impact the future of international trade.

 

Andrew Woelflein