Currency risk management

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At Insight, we view unintended exposure to foreign exchange rates as a significant unmanaged risk in portfolios. Global currencies are prone to extreme moves, owing to structural breaks in drivers of currency or market cycles. Sources of returns and generators of losses can shift rapidly with significant portfolio consequences. Currencies exhibit multi-year trends that can erode an international asset portfolio.

Watch our video to hear Constantine Ponticos, Head of Strategic Research discuss why investors should be concerned about currency risk in their portfolios.

WHY INSIGHT FOR CURRENCY SOLUTIONS?

Long track record: we have been managing currency risk for our clients for over 25 years, helping them to define policy objectives and constraints while assessing the trade-offs relevant to currency policy formulation.

Client focused: Currency Risk Management (CRM) is an active hedging program that is tailored to manage clients' foreign currency exposure and risk sensitivity. It employs a proprietary, quantitative model with a highly flexible framework to accommodate a range of client requirements.

Advanced statistical modeling and monitoring: proprietary currency models monitor hedge levels and calculate adjustment trades.

Robust portfolio construction: we manage portfolios against a range of benchmark hedge ratios from 0% to 100% and adhere to strict downside loss constraints as well as incorporate a variety of value adding elements that seek to capture value as opportunities arise. CRM is a systematic program that is supported by state-of-the-art infrastructure and an experienced trading desk with dedicated client portfolio managers.

Strategy in numbers

  • 1991 Year we started actively managing currency risk for our clients
  • 23 investment professionals with 16 years' average industry experience
  • US$50.1bn assets managed by the Currency Solutions team

As of March 31, 2019. Assets under management (AUM) are represented by the value of cash securities and other economic exposures, and are calculated on a gross notional basis.*

All data as of March 31, 2019.

*Insight North America (INA) is part of “Insight” or “Insight Investment”, the corporate brand for certain asset management companies operated by Insight Investment Management Limited including, among others, Insight Investment Management (Global) Limited and Insight Investment International Limited. Advisory services referenced herein are available in the US only through INA. Figures shown in USD. FX rates as per WM Reuters 4pm spot rates.

Includes employees of Insight North America LLC (INA) and its affiliates, which provide asset management services as part of Insight, the corporate brand for certain companies operated by Insight Investment Management Limited (IIML).

Insight North America LLC (INA) is a registered investment adviser under the Investment Advisers Act of 1940 and regulated by the US Securities and Exchange Commission. INA is part of “Insight” or “Insight Investment”, the corporate brand for certain asset management companies operated by Insight Investment Management Limited including, among others, Insight Investment Management (Global) Limited and Insight Investment International Limited. Insight’s assets under management are represented by the value of cash securities and other economic exposures, and are calculated on a gross notional basis. Advisory services referenced herein are available in the US only through INA.  

The views herein represent the opinions of Insight and are subject to change based on subsequent developments. They are not intended as investment advice or to predict or depict the performance of any investment. The material contained herein is not intended to provide, and should not be relied on for, investment, accounting or legal tax advice. Further, this material does not constitute a recommendation to buy, sell or hold any security. No offer or solicitation for the sale of any security or financial instrument is made hereby.