Currency risk

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Currency risk

Currency Risk

In currency exchange, the possibility that one currency will devalue to the exchanger's detriment. For example, someone may move to the United Kingdom from the United States and change all of his/her money from dollars to pounds. If he/she moves back to the United States with the same amount of pounds, there is the possibility that the pound will have devalued, resulting in fewer dollars than he/she brought to the U.K. In 1996, economist Conway Lackman suggested an extension of the Capital Asset Pricing Model to help calculate exchange risk in international trade.
References in periodicals archive ?
The desire of the National Bank to neutralize currency risks (mainly dependence on the US dollar) was reflected in a 7-fold increase in the volume of the yellow metal in the composition of gold and foreign exchange reserves over 10 years.
BANKING AND CREDIT NEWS-October 3, 2018--Taiwan central bank governor warns of currency risks
M2 EQUITYBITES-October 3, 2018--Taiwan central bank governor warns of currency risks
Global Banking News-October 3, 2018--Taiwan central bank governor warns of currency risks
With this guarantee operation, the Bank's support to Senegal aims to reduce the costs and currency risks associated with large amounts of financing required to implement the PSE, Pierre Guislain, Bank Vice-President for Private Sector, Infrastructure and Industrialization, said.
Strategic foreign currency management differs from traditional accounting exposures because strategic foreign currency management becomes an integral part of a business's operations and requires the combined efforts of operating and financial functions to identify currency risks and opportunities.
"The trading of Asian FX futures on SGX offers global investors a transparent, margin-efficient and well-regulated marketplace to seamlessly manage their Asian currency risks. We will be adding more currency pairs to our Asian FX suite over the next 12 to 18 months.
One such platform provider is (http://www.fxwells.com/) FXWELLS , which provides simple and flexible hedges available for corporates with limited liquidity as against currency risks. (http://training.ibtrade.com/) IBTRADE is yet another platform provider available for individual traders looking to hedge their trading position through FX options.
Areximbank-Gazprombank Group offers its customers reliable mechanisms to protect savings from currency risks
Volkswagen Brazil, a wholly owned subsidiary of Volkswagen AG (Xetra: VW), has chosen Bloomberg's Foreign Exchange trading platform, FXGO, to manage its global currency risks.
They are the degree of foreign exchange hedging, ability to weather currency risks, reliance on imported raw materials, the extent of internationalization, capital dependence, product heterogeneity and production flexibility.
Morissette says National Bank of Canada makes loans in various currencies to film clients to offset currency risks and most financial institutions offer hedges that let clients lock in an exchange rate, though such hedging transactions add a layer of cost.