Currency risk sharing

Currency risk sharing

An agreement by the parties to a transaction to share the currency risk associated with the transaction. The arrangement involves a customized hedge contract embedded in the underlying transaction.

Currency Risk Sharing

An agreement between two parties where they share the foreign exchange risk associated with a transaction. For example, a buyer in Britain and a seller in the United States may agree to split the difference between any gains or losses that may result from the sale of the good or service. Currency risk sharing reduces foreign exchange risk for both parties.
References in periodicals archive ?
The Local Currency Lending Programme is supported by international donors through the ETC Local Currency Risk Sharing Special Fund.
Proven ways to manage your currency risk - currency risk sharing arrangements, natural hedging, and sophisticated instruments, including options, swaps, futures and forwards, all explained in practical terms.