Currency hedging is the creation of an offsetting position, undertaken (most of the time) with forward contracts, in order to neutralize any gain or loss on the original currency exposure by a corresponding foreign exchange loss or gain on the hedge. Whether the exchange rate goes up or down, the company is protected because the hedge has locked in a home-currency value for the exposure. A company that undertakes a foreign currency hedge is therefore indifferent to the movement of market prices in currency markets. Currency hedging differs from a speculation, where a currency position is taken in anticipation of an expected change in currency rates. Currency hedging is usually implemented through hedging programs based on the business specifics of each company, including its pricing parameters, the location of its competitors, the weight of FX in the business and other considerations. Some of these programs and combinations of programs can be quite demanding, a real challenge for treasury teams relying on manual systems. Their proper implementation and management requires, therefore, automated solutions provided by Currency Management Automation.