Risk Management
The Decision to Trade in Domestic or Foreign Currency: How to Weigh the Risks By Scott Smith
When local just makes sense For treasurers working with international companies that may be expanding into new markets or that are facing growing competition abroad, there comes a time to examine the exchange rate situation and consider the prospects of dealing in the currency local to their foreign trading partners. This can be a
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CANADIAN TREASURER
daunting task for the cash manager who is often happier in the comfort zone of his domestic currency, which leaves no room for FX volatility or the complexity of hedging. However, when both the risks and the opportunities become too great to ignore, the treasurers who become too complacent will be pushed to make a choice – and how they make that choice and manage the consequences is crucial to the success of their organization. For any business that might set its sights on
Winter 2014