Hedging

Avoiding risks on the financial markets

Hedging

Avoiding risks on the financial markets

Financial markets can be extremely volatile. Unforeseen market movements can have a substantial financial impact. By covering or hedging these risks, you can avoid financial losses. Are you interested in avoiding foreign exchange rate or interest rate risks?  Please contact the KBC Corporate Sales team or visit the electronic platform to view or discuss our various hedging products. Our Corporate Sales team offers a more extensive variety of hedging techniques, ranging from the most simple to more tailored solutions, e.g. the use of options.

What is hedging?


The financial products used to mitigate the risks attached to economic positions are called hedging instruments. In practice, hedging  involves the conclusion of an agreement to cover an existing or future risk. This hedging can be arranged for all or part of the underlying risk.  The financial instruments therefore fully or partially mitigate the negative effects on the results. The intention is for your company's financial results to be less sensitive to market fluctuations (foreign exchange rates, interest etc.). This is achieved by combining the company's own economic position and hedging through a financial product. 

Typical examples of exposure are: the foreign exchange risk, interest rate risk and liquidity risk.

Protecting your company against risks

The considerable fluctuations of foreign currency in respect of the euro requires a great deal of attention from many European company managers. After all, the foreign exchange rates directly affect: 

  • the prices of raw materials;
  • the value of foreign investments and sales;
  • the competitiveness of their company in domestic and foreign markets. 

But it's not just exchange rates; interest rates too have an impact on the value and profits achieved by your business. 

If you want to make sure your balance sheet stays balanced, you will have to reduce your company’s sensitivity to fluctuations in exchange and interest rates. KBC is your ideal partner: we can draw up a thorough analysis of all the risks involved in your specific situation and develop tailored financial instruments to achieve the best possible risk management.

Team of experts at your service

Our job? We will provide any advice you may require and assist you in determining your hedging strategy. In doing so, we want to offer you the best tools.

We can also assist you online. Go & Deal is an app that allows you to manage your foreign exchange risks 24/5.

Who?

Your relationship manager is in contact with the KBC Corporate Sales Desk. A team of 14 sales specialists, each with their own region: Flanders, Brabant and Limburg, Antwerp and the international branches.  These experts work closely with the various Corporate Banking, Debt and Capital Marketing, and Equity and Specialty Finance business units.

The KBC Research Team constantly keeps you updated on the most important facts and developments in the foreign exchange, interest rate and commodity markets.

How?

  • You can contact contact the KBC Corporate Sales Desk by phone((+32 2 417 32 69 of esales@kbc.be).
  • Through the Go & Deal platform, 24/5, for your exchange transactions.
  • Through the KBC Market Research App, where you can access daily reports and analyses.
  • Through seminars, where you will be informed of the latest trends and products. 

We believe it's important that you and your trusted relationship manager are supported by a research team that knows your company through and through.

You can find an extensive but not limitative list of risk management products in the KBC Treasury Handbook of Market Risk Management. This handbook provides a description of the most widely used hedging products and strategies, in order of complexity. In addition, the handbook is divided into useful modules for importers and exporters.

Want to know more?

If you have any questions regarding hedging or other aspects of risk management for the stock market, please do not hesitate to contact your relationship manager.

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