Hedging for Asset Managers
We provide specialist currency management solutions to manage the currency risk in private assets, share classes, feeders, and other funds.
Highlights
Information as at 29th Dec 2023
40+
Years’ experience trading in FX markets
$700bn+
Annual FX trading volumes
30+
Strong and longstanding relationships with major global counterparty banks
40+
Years’ experience trading in FX markets
$700bn+
Annual FX trading volumes
30+
Strong and longstanding relationships with major global counterparty banks
“We fully appreciate that currency risk management requirements vary considerably across managers. We pride ourselves on our ability to work in partnership with our clients to offer bespoke solutions catered to their needs”
Dr Dmitri Tikhonov, CFA
Chief Investment Officer
How We Add Value For Clients
With over 40 years’ experience in currency hedging, we have proven expertise in creating optimised solutions for Limited and General Partners across the alternative investment space.
Offer unmargined, uncollateralised FX trading lines using our agency ISDAs with 30+ major global banks
Act as your agent, to achieve transparent, low execution costs, in line with our best execution policy
Full outsourcing of operational risk to us across the entire currency management process
Fully regulated to advise on and create bespoke hedging solutions, in collaboration with you
Considerations When Choosing A Currency Management Strategy
We tailor our approach to your unique requirements and partner with you to agree the most optimal hedging solution, which is dependent on factors such as:
Fund Asset Class
Different asset classes can benefit from the use of different instruments;
- FX forward contracts are flexible and well suited to hedging income generating assets.
- FX options can be more useful in managing currency risk in the acquisitions prevalent in private equity funds.
Fund Structure & Liquidity Profile
Open-ended and closed-ended funds will have different liquidity profiles around which a hedging programme can be built. Drawdown funds, where investor and fund currency differ, can benefit from managing the possibility of FX related liquidity shortfalls when calling upon investors’ committed capital.
Tolerance For FX Related Cashflows
Funds with low levels of liquidity may benefit from specialised instruments with incorporated credit, which can provide protection with no upfront or ongoing cash requirements.
Stage of Fund Lifecycle
Different phases of a fund’s life require different hedging considerations. Early phase lock-up periods can create a significantly different liquidity profile to later phases when a fund is mature and liquidating assets.