Foreign exchange risk management | HSBC International

Don't let fluctuations in exchange rates erode your profits

When you conduct business internationally, even small changes in foreign currency values can have a big impact on your bottom line. It pays to be educated on managing the risks involved.

Foreign exchange risk explained

The most common cause of foreign exchange (FX) risk arises from making overseas payments for your imports that are priced in a foreign currency¹ and receiving foreign currency as payment for your exports. Exposure to foreign exchange risk can also arise from:

• Foreign currency borrowing or deposits
• Overseas subsidiaries
• Assets located overseas

Failing to protect against movements in FX rates effectively means buying or selling without having agreed to a price in dollars. FX protection is an essential service for:

• Importers and exporters of goods and services
• Owners of overseas assets, joint ventures or partnerships
• Group companies and subsidiaries in more than one country

How to get FX protection

The FX specialists on our Global Markets team will work with you to develop a four point plan to help minimize your foreign exchange risk and protect your profitability.

• Understand your exposures
• Understand the solutions
• Develop a strategy
• Implement your plan

To see the four point plan in more detail and how it could work for you, download our guide: Identify and Manage FX Risk (PDF)

Call our dedicated Business Banking Customer Service² at 877.472.2249 (TTY/TTD: 800.898.5999), or contact your local Relationship Manager for more information.