what instruments do you prefer for hedging currency risk?
must be available from a typical broker
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This entry was posted on Friday, January 29th, 2010 at 5:28 am and is filed under Currency Trading. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
January 29th, 2010 at 5:28 am
Depends on the situation. If it’s for a business with overseas currency exposure, it might be a currency swap or a dual currency deposit or a currency overlay.
For the individual you can buy any stronger currency as a hedge through Forex, or you can trade the Dollar Index futures, but that’s a huge contract, hedging a lot of USD’s. All currencies are commodities and can be traded as such through a futures broker.
January 29th, 2010 at 5:28 am
You could try currency ETFs and the options available on these. They are easily available in standard brokerage accounts.