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WHY HEDGE FX?

FORTUNE 500 COMPANIES HEDGE FX BECAUSE IT HELPS THEM MANAGE THEIR INTERNATIONAL BUSINESS FLOWS AND HELPS PREVENT SURPRISES WITH RESPECT TO EARNINGS

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MARGIN IMPROVEMENT
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REDUCE EARNINGS VARIANCE
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CRYSTALIZE / MANAGE CASH FLOWS

Sourcing and / or selling internationally can lead to unexpectedly high expenses or low revenues.

Hedging FX risk can lock in margins

Moderating margin variance leads directly to reduced earnings variance

Reduced earnings variance allows for better planning and enhances growth

Cash is king and locking in FX rates insures known cash flow outcomes

Hedging FX can ensure cash flows are known, whether inflows or outflows, and help cash management and liquidity processes.

Who Hedges FX?

Corporates across all industries are active FX hedgers, including:

  • Consumer Products

  • Industrial Products

  • Energy & Resources

  • Life Sciences & Health Care

  • Technology, Media & Telecom

  • Non-bank Financials

Which Exposures Do They Hedge?

CASH FLOWS

  • Forecasted

  • Committed transactions

BALANCE SHEET​

  • Monetary balances in foreign currencies

  • A/R & A/P

TRANSLATION​

  • Net Investment

  • Earnings

How Much Do They Hedge?

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T: +1 (917) 692 - 7914​

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