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Currency Overlay

   Also found in: Wikipedia 0.03 sec.
Currency Overlay
The outsourcing of currency risk management to a specialist firm, known as the overlay manager. This is used in international investment portfolios to separate the management of currency risk from the asset allocation and security selection decisions of the investor's money managers.

Notes:
The overlay manager's hedging is "overlaid" on the portfolios created by the other money managers, whose activities continue unaffected.


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During this period he expanded the firm's discretionary foreign exchange management activities and co-developed Tamiso's Currency Overlay Program.
The Bank of New York's Global Markets Division encompasses the Bank's foreign exchange, interest-rate and equity risk management businesses, including global trading, currency overlay and sales activities.
Russell's service attracted several additional clients last year, including the Oregon Investment Council, all seeking risk control and enhanced performance for their total plan assets through rebalatization, portable alpha, cash equitization, synthetic rebalancing, and/or currency overlays.
 
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