International investments and exits: the role of currency
Private equity, venture capital and family office firms tend to have a highly diverse international portfolio. This poses a three-fold risk in terms of currency exposure, which must be managed accordingly:
- In investment: When investing in foreign companies, it is crucial to avoid the devaluation of the currency in which funds are collected in relation to the currency in which the investment is to be made.
- In exit: Major sales transactions involve many moving parts. The slightest change in the exchange rate in the interval between a sale being agreed and completed can entail a substantial drop in profit.
- In the operation of investee companies: Optimal management in the investment process is in vain if the investee company neglects its risk exposure.
Controlling exchange rate risk in investment projects
The dynamics and timings of investment projects have specific requirements when it comes to the use of foreign currencies:
Controlling exposure to exchange rate risk
Successful planning and execution of projects depends on the ability to safeguard against volatility and exposure throughout the process, and particularly during the investment and divestment phases. Our simple technology platform, coupled with the personalised assistance of one of our FX Specialists, enables you to efficiently meet these needs.
Planning on a per-project basis
Every project has different time frames and needs. To optimise cash flows, we recommend defining a currency policy and target exchange rates at key points in the process. Alerts and automatic orders complete the package, ensuring you trade only at the most favourable times.
Efficiency, agility and transparency in currency exchange
The need to make large transactions at precise moments means that it is vital for companies to have a system guaranteeing they can trade whenever they require, whether through spot trades or flexible forward contracts, and with total transparency. With our technology, you have an at-a- glance overview of your options at all times, and can act securely and swiftly.