Risk management is often a two stage process. First is the analysis phase where a company or investment portfolio will analyze its risk and risk appetite. Second is the execution phase which is where the analysis from phase one is used to formulate a strategy for minimizing that risk. It can be simplified as an insurance that ensures an incident doesn’t occur.
Genuine Trading Solutions Ltd. is a derivatives and riskspecialist registered with the CFTC as a CTA. The company is noticing a dramatic increase in enquiries for the use of hedging as part of a comprehensive risk management program.
While large firms understand hedging strategy and how it is used in risk management, it is small and medium sized companies who are now beginning to understand hedging solutionsas an integral component in a comprehensive risk management program. You can’t have one without the other. “No matter how much analysis your firm does, at some point it is time to implement the execution phase with the use of derivatives hedging to minimize that risk,” says company President Dwayne Strocen. He goes on to say “Within the last six months we have noticed a dramatic rise in enquiries from all levels of companies who have not previously considered hedging as part of their risk program. This has included grocers, retailers, wholesalers, manufacturers, credit unions, hedge funds and private investment portfolios.” Concern has been expressed for pending economic uncertainty in both North America and Europe. Recent hints from the US Federal Reserve for an up tick in interest rates is seen as a clear signal for additional monetary tightening throughout this year and into 2019.
Is an increase in the use of risk hedging a pre-cursor to an economy ready for a pull back? Perhaps these CFO’s suspect something others don’t, time will tell. Since risk hedging should be thought of as an insurance plan against unexpected market reversals it is always a good idea to minimize your risk and put that program into action.
For more information, visit: www.genuineCTA.com
Company Name: Genuine Trading Solutions Ltd
Contact Person: Dwayne Strocen – President
Phone: (888) 317-9077