currency risk management
Currency risk management is a recurring problem for asset managers who invest part of their clients’ portfolios in foreign currencies.
Three options are available to the manager :
- hedging through a forward or a swap
- no hedge
- dynamic management of the currency risk
A leader in currency risk programs for institutional clients has launched a currency overlay product that allows asset managers to manage the currency exposure in its clients' individual portfolios.
The manager will simply buy units in a compartment of the product corresponding to the clients’ currency risk profile.