NeuGroup Insights seeks Amanda Breslin's thoughts on hedging cyclical currencies
- January 13, 2022
The NeuGroup's online community provides their members a forum to pose questions and give answers. "Talking Shop" shares valuable insights from these exchanges, anonymously. Amanda Breslin provided her insight on hedging cyclical currencies.
Amanda Breslin in NeuGroup
"Chatham’s clients design their balance sheet hedging programs to reduce volatility 'with an eye towards operational simplicity, setting hedging triggers and ratios that can be broadly applied and consistently executed, rather than isolating specific currencies.'”
NeuGroup Insights reached out to Amanda Breslin, Chatham Financial’s managing director of corporate treasury advisory, for additional insight on how Chatham’s clients handle the issue.
- In accord with Ms. Friberg’s point, she said that most of Chatham’s clients design their balance sheet hedging programs to reduce volatility “with an eye towards operational simplicity, setting hedging triggers and ratios that can be broadly applied and consistently executed, rather than isolating specific currencies.”
- Ms. Breslin added that “exceptions are most often seen due to material transaction costs related to liquidity, companies that have a strong bias towards using forward points as a proxy for hedging costs and/or currencies that represent a relatively high or low proportion of the aggregate risk in the portfolio.”
Our expertise for corporatesChatham provides the knowledge and expertise needed to manage the financial risk associated with interest rate, commodity, and foreign exchange volatility. We develop and implement hedging strategies for hundreds of public companies annually, based on deep and productive banking relationships, giving us market data and insights to enable you to secure the best pricing and terms. Our goal is to empower you to strengthen your financial position and support your company’s financial objectives.
With expertise across hedge accounting, regulatory compliance, valuations, and hedging transactions, we can support all aspects of financial risk management. Our ChathamDirect platform provides convenient workflow, robust analytics, and comprehensive accounting methodologies, supported by our unmatched commitment to client service. This unique combination of strategy, operations, and technology will empower you to run a best-in-class hedging program.
Our featured insights
Inflation continues to rise as crypto plunges
Inflation numbers are hot off the press and exceeding expectations as reports that the price of goods and services rose by 8.3% since last April. Although there is hope that we are falling from the peak numbers seen in March, consumer fears of a recession are growing and permeating the market —...
Hedging fundamentals webinar series
Join these introductions to hedging and hedge accounting to gain a foundation for managing financial risk.
Fed raises rates amid a plethora of employment data
The Federal Reserve raised the Fed Funds rate by 50 bps, bringing in the largest hike since 2000 in an effort to fight the highest inflation rate the country has seen in 40 years. Job openings and job quits hit record highs in March, while April nonfarm payrolls came in above expectations.
Mixed first quarter sets stage for volatile year
The familiar story of global volatility continues. U.S. GDP stumbled for the first time since early in the pandemic. Global currencies weakened against the dollar, as dollar strength reached its highest levels since the early 2000s. Supply chain concerns rise from record diesel fuel prices.
Uncertainty continues as markets respond to imminent rate hikes, war in Ukraine
Inflation and global turmoil continue to plague the international markets as the war in Ukraine persists. Market expectations in response to impending further rate hikes by the Federal Reserve pushed stocks down and bond yields higher. Stronger relative performance in the U.S. pushed the dollar...
How to maintain treasury proficiency and continuity amid the “Great Resignation”
Today’s job market creates challenges and opportunities for treasury teams. While high turnover warrants increased focus on retention and contingency planning, it also offers the chance to attract new talent, reinvent your team dynamic, and streamline operations.
Headline inflation hits 40-year highs, recession chatter echoes throughout markets
Headline CPI data surpassed its 40-year high in March but slowing core inflation provided investors with a glimmer of optimism. Markets are closely monitoring Fed movements as Chairman Powell attempts to navigate a difficult balancing act of cooling off alarmingly high price pressures while...
Fed hawks have landed
Released Fed minutes show a growing hawkish and tightening mindset across FOMC members. The release drove rates higher as members called for fast balance sheet reduction and double rate hikes in upcoming meetings. Meanwhile, commodity hedges for petroleum products break down.