Focusing on the commercials

Since the early 1970s exchange volatility has increased markedly. This increased volatility is a major concern not only for government policy makers but also corporations engaged in international activities. Despite the saturated Corporate FX , theprofitability of corporates of all sizes can be sharply altered by unanticipated exchange rate movements. This situation has posed a perplexing challenge to researchers, Finance teams and foreign exchange vendors vendors alike. Often hedging too much can be as damaging as not hedging at all. 


Over the past decade considerable progress has been made in our ability to not only understand the causes of exchange rate fluctuations and their impact on economic foreign exchange risk but also in the tools used to better identify, back test and stress test effective risk management hedging models.


Even today, most brokers and merchant bankers in the corporate foreign exchange market are high performing  salesmen without an academic understanding of what effective risk management really looks like. Instead the market has a certain stigma due to a lack of transparency and the pressure selling of unnecessarily large and long “ hedging contracts”. 


That is where we differ. Our business is built upon a collection of ideas inspired from academic experts from the fields of economics, finance, accounting and treasury management. We construct protoype rolling hedging models from several distinguished practitioners from international corporations and financial institutions. The aim is to better understand how foreign exchange risk occurs, and what technological advances can do to address modern day inefficiencies in the methodologies used by European corporates when they expose themselves to unnecessary levels of risk. 


We strive to be a breath of fresh air in a stale market. If we can’t find a costly inefficiency in the way that you hedge and to your business, then we whole heartedly recommend your current vendor.