Managing foreign currencies risk
Real estate companies are increasingly diversifying their portfolios by investing in assets abroad. Understanding these exposures and how to protect against foreign currency swings are key to making the right investment decisions.
Chatham Financial serves real estate clients to effectively manage their FX risk across a broad spectrum of currencies. We help our clients understand their exposure, quantify, and mitigate their FX risk.
FX Hedging to protect against volatility
Tailored risk assessment and analysis: Each FX hedging solution involves analyzing the underlying exposure, netting of those exposures, currency hedging order and evaluating hedging alternatives. Chatham evaluates where currency hedging can cause more volatility and we identify areas for natural hedging. We provide informed recommendations and arm our clients with all the necessary data to make prudent hedging decisions.
Comprehensive execution process: Expert consultants, proprietary models, and in-house technology applications all feed into Chatham’s market-tested processes. This produces both financial results and working relationships valued by more than 1,000 real estate developers, opportunity funds, and REITs. When you work with Chatham Financial to protect against FX risk, you can expect:
- Hedging strategy. We assess currency risk, net of exposures, natural hedges and offset, risk quantification, and optimal hedging order.
- Counterparty pool. We assemble banks and establish trading lines to create a competitive and effective group to leverage during the execution of transactions.
- Transaction preparation. We arrange and execute transactions through competitive auction or negotiation.
- Reporting and administration. We provide record-keeping and reporting as well as documentation assistance for legal and compliance (such as Dodd-Frank and EMIR).
Fully scaled hedge accounting practice: If you have reporting obligations as an SEC filing company, Chatham’s expertise ranges from risk management strategy to transparent reporting, with best-in-class hedge accounting and debt and derivatives valuation practices. We also offer industry-leading regulatory compliance advisory.
Our expertise in ASC 815 and IAS 39 standards enables us to advise on optimal economic hedging structures that can receive the most favorable hedge accounting treatments, thereby reducing or eliminating earnings volatility. Our processes and methodologies are respected by auditors and regulators alike.
How companies work with Chatham
Chatham Financial specializes in debt and derivatives across asset classes, helping clients understand how their interest rate risk, foreign currency risk, and other financial and economic risks intersect and relate. We understand trends and practices and translate them into the best solutions for individual foreign currency risk challenges. Our fee structures are transparent and our expert advisors don’t charge by the hour.