You've Hedged the Exchange Rate. But Can You Get the Currency?

Why exchange-rate risk, convertibility and access to hard currency are not the same thing

An FX hedge can protect the price at which currency is exchanged. It cannot guarantee that the currency will actually be available. This LKA Perspective examines the distinction between exchange-rate risk, convertibility risk and transfer risk -- and why understanding the underlying commercial exposure matters as much as choosing the hedge itself.

EURUSD: Hedging Long-Dated Currency Risk

Why the forward curve is only part of the story

Long-dated FX exposures can create significant risks around pricing, timing, credit and liquidity. This LKA Perspective examines the practical issues that arise when hedging EURUSD exposures - from forward points and hedge timing to mandatory breaks, options and the credit implications of long-dated hedges.