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FX Initiative Blog

Actionable insights on foreign exchange risk management from FX Initiative.

Exploring FX Economic Risk

Exploring FX Economic Risk (Video): Explore the concept of foreign exchange (FX) economic risk and recognize its macro impact on the financial statements and global business opportunities. This video is a preview of FX Initiative’s FX Risk Exposures course as part of Learning Objective #1.

 

To learn more, start your FX risk management training today, which provides 24/7 365 access to our complete suite of foreign exchange (FX) continuing professional education (CPE), examples & events at FXCPE.com.

 

Mapping Currencies Across Countries

Mapping Currencies Across Countries: It is evident that no one single world currency exists. There are over 180 currencies recognized as legal tender in circulation throughout the world. The most widely used list of currencies is known as ISO 4217, which is a standard published by the International Organization for Standardization or the ISO. The ISO is an international standard-setting body composed of representatives from various national standards organizations, and the ISO 4217 currency codes shown in this interactive map are used in banking and business globally.

While many of us are familiar with the “Major” currencies, which include the euro, British pound sterling, Australian dollar, New Zealand dollar, United States dollar, Canadian dollar, Swiss franc, and Japanese yen, there are so many more currencies to explore. This interactive map helps you explore the world through the lens of currency. All 180 currencies in circulation are mapped using geographic coordinates and ISO 4217 currency codes. Simply click on the dots on the map to reveal the ISO 4217 currency code, currency name, country.

To learn more about conquering currency risk, start your FX risk management training today, which provides 24/7 365 access to our complete suite of foreign exchange (FX) continuing professional education (CPE), examples & events at FXCPE.com.

 

How Brexit Impacts the FX Bottom Line

Many have read about Brexit in the news headlines, which is a term that refers to the United Kingdom's planned withdrawal from the European Union (EU). Since the EU referendum took place in June of 2016, the British pound sterling (GBP) has declined in value against the U.S. dollar (USD) by roughly 15% from June 24, 2016 levels which hovered around the 1.4500 mark to approximately 1.2500 levels as of April 17, 2017. In less than a year, many companies with foreign currency exposure to the British pound sterling have seen a serious impact to the bottom line of the income statement.

Looking at this political event from a foreign exchange risk management perspective, Brexit would fall under the category of foreign exchange economic risk that is covered in FX Initiative’s FX Risk Exposures course. Economic risk relates to the macro impact fluctuating foreign exchange rates have on business opportunities, and includes the risk associated with the political, economic, and regulatory environment of the country or region in which a firm is conducting business.

The following 3 minute video clip from FX Initiative’s FX Risk Exposures course describes the concept of foreign exchange economic risk, and highlights 2 examples which include Venezuela’s 2010 changes in government policy and Apple’s 2015 10-K disclosures. While Brexit type events may not be predictable or preventable, companies can protect themselves over an extended time frame by laying out a long term and sustainable foreign exchange risk management plan.

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If you are interested in learning more about the different types of foreign exchange risk and how you can protect your company against adverse changes in exchange rates, sign up for our Foreign Exchange Risk Management Training today and access our complete suite of foreign exchange (FX) continuing professional education (CPE), examples and events at FXCPE.com. Managing FX risk has become a higher priority for many firms for 2017 and it is now easier than ever to learn the fundamentals of currency risk management. Make this the year to reduce FX risk and reap rewards abroad by taking the FX Initiative for your international business today!

Click here to start your FX Risk Management Training today!

Cheers to your global organization's continued success in the new year,

The FX Initiative Team
support@fxinitiative.com

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