Currency Risk Management

Fluctuations in currency markets can result in significant financial losses. Volatility can eat away at profit margins by impacting business costs, for example by increasing payables or reducing receivables. Companies with robust currency hedging strategies can take steps to mitigate these risks but selecting an appropriate currency strategy can be a complex process.

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Overview

Currency Risk Management

Smart Currency Business works with companies to create tailored currency hedging strategies to manage currency risk, protecting their bottom lines by conducting thorough reviews of the potential risks and their unique impact on each business.

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Our dedicated team of currency risk management experts are on hand to exchange your money into a variety of different currencies, enabling you to make instant international payments.

We are passionate about working closely with our clients to deliver a proactive, solution-led service. Our team will work with you to develop a bespoke strategy for managing risk.

We provide professional currency guidance on market movements that helps our clients minimise risk when making foreign currency exchanges.

Understanding and Evaluating Risk:

In order to create a comprehensive treasury management and currency strategy, the first step is to understand the different economic and business risks and evaluate their impact.

Currency market risk can be attributed to a number of economic and business factors:

  • Transactional risk

Transactional risk relates to the exposure caused through regular business transactions and day-to-day business. For example, payables to overseas suppliers, receivables from the sale of exported goods and/or services, international intercompany payments, and funding/dividend exposures from overseas assets.

  • Translational risk

Translation risk arises when companies conducting business in foreign markets need to translate the value of their overseas assets and liabilities into their home currency, in order to consolidate parent and foreign subsidiary financial statements. Fluctuating currency exchange rates can have a significant impact upon shareholders’ investments.

  • Economic risk

Economic risk arises from the performance of global and domestic markets and their effects on your business.

Case Study

Robust Risk Management

Learn how a major publishing body developed a robust risk management strategy.

Managing currency exposures is key in volatile markets. Our team were able to implement a range of risk management strategies to mitigate this company’s exposures.

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Understanding exposures

Our team worked to understand its unique exposures and objectives

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Improving outcomes

After consultation, our solutions helped protect against worst case scenarios

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Custom service

Our ongoing support works as a backstop against market change

What makes us different

SmartHedge

SmartHedge is our currency management platform that makes tracking exposures simpler than ever. Developed and tested to address pressing challenges UK companies face, SmartHedge offers automated solutions that allow business to spend less time pouring over spreadsheets and more time making the decisions that matter.

From reporting and valuations to cashflow forecasting and stress testing, SmartHedge helps businesses find clarity in chaotic markets.

Our Sectors

Aviation

Fashion

Film & TV

Manufacturing

Pharmaceuticals

Travel

How we work

Trading with us is simple

Follow our streamlined steps to navigate currency markets effortlessly.

Open an account

Opening an account with Smart Currency Business is simple.

Quick and easy

Complete the enquiry form below, or give us a call.

Guided process

Our team will be happy to guide you through the process.

Speak to our team today