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Bloomberg’s take on the new Foreign Exchange (FX) Hedging mindset

This article on gtnews by Bloomberg's Alison Fletcher describes a new attitude they see developing among treasurers world-wide. She believes that the traditional approach where corporate treasurers focused on looking at forecasts to decide whether to hedge their currency exposure and how best to do so, and then using their relationship banks to determine what to do have been replaced by the availability of advanced analytical tools and access to more information than ever before.

She then gives examples - of course using Bloomberg's data and analytical tools - of how they enable corporates to adopt a new mindset. This enables corporate treasurers: to see the investor flows, to use option volatility as a gauge of market sentiment, to back test their hedges, to carry out additional pre-trade analysis, to determine long-term valuation, and to address sovereign risk

Inevitably Alison finishes by saying: "Corporate treasurers will only stand to benefit from incorporating such tools into their decision-making process, while adopting a new hedging mindset that considers market volatility and risks."


You don't have to use Bloomberg's data and analytical tools, but you should read this article as it is full of ideas and new approaches.


Read more in the full article - highly recommended - here.

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