A hedging strategy 'could add security'

A hedging strategy could provide more security for people who are looking to transfer money between countries, it has been claimed.

The current foreign exchange market is very volatile and there have been many unprecedented moves, explained head of private clients at World First Elisabeth Dobson.

People who need to send finances overseas, especially large sums, can have more protection if they enter a hedging strategy of a currency option, she added.

Ms Dobson stated: "It means they can secure the worst case rate on the exchange rate but benefit if the rate improves."

There have been an increasing number of clients who have taken up on such schemes to protect themselves against the unstable and unpredictable market, she concluded.

World First also recently stated the number of people bringing back euros into the UK doubled over the last 12 months.

According to J P Morgan's 10th Annual Global Cash Management Survey, published on February 4th 2009, the risk associated with foreign exchange was named by 43 per cent of respondents as the main concern for the year ahead.