Managing risk

Your personal risk tolerance is an important factor when entering into a foreign exchange (FX) transaction. How much are you prepared to risk? Depending on your situation, doing nothing can carry significant risks and you could therefore be better off making an investment designed to reduce the risk associated with movements in the currency markets.

Let's take a look at the questions you can ask yourself to help make the right call for you.

How can I make a more informed decision?
Factors in the market are often difficult to predict and there is therefore a certain element of uncertainty as to whether a particular FX transaction could cost you more today than it would tomorrow. However, with an experienced Barclays International Treasury Specialist to help guide you through the relevant options to take into consideration, you are more likely to make more informed decisions.

In the FX market, it's not possible to cut out risk entirely. Even if you take action to buy some certainty, such as a FX forward, you might not do as well as if you had held out and made the exchange at a later date. You can only make the best decision with the information you have.

How can I cut out risk?
In the FX market, it's not possible to cut out risk entirely. Even if you take action to buy some certainty, such as a FX forward, you might not do as well as if you had held out and made the exchange at a later date. You can only make the best decision with the information you have.

How can I buy some certainty?
A FX forward is a contract to buy or sell a stated amount of a given currency at a specific price on an agreed date or range of dates in the future. If the current exchange rate is good you can take advantage of this to make your transaction in the future. Of course, the rate could still improve but at least you have the privilege of knowing that if it moves against you, the cost of your transactions isn't negatively impacted. The opportunity to transact on an improved rate may well be worth less to you than the peace of mind you have knowing that you won't have to transact on a lower rate.

What is my personal risk tolerance?
How much are you prepared to risk? That's the ultimate question you have to ask yourself. We can take you through a process to help you understand your attitude towards risk, and work with you to find the most appropriate solutions based on your profile and financial objectives.

You have sole responsibility for the management of your tax and legal affairs, including making any applicable filings and payments and complying with any applicable laws and regulations. We have not provided and will not provide you with tax or legal advice and recommend that you obtain your own independent tax and legal advice tailored to your individual circumstances.

Find out more about our FX services

If you are not currently a Barclays International client, but are interested in our FX services you will first need to apply for our banking services, which you can do by calling +44 (0)1624 684498† or accessing our online application by pressing the button below.

If you are an existing client and would like to find out more information please either contact your Relationship Manager, call us on +44 (0)1624 684498† or complete a call back request form.

Please note: access to our Treasury Specialists is via a three-way conference call. Clients who do not have a Relationship Manager and require a call with a Treasury Specialist or want to conduct a FX forward should either:

  • Hold assets of £50,000 with us, or
  • Intend to transact a minimum £50k (or currency equivalent)

The products and services described on this page are provided by the following companies, which are part of Barclays: Barclays Bank PLC in London and Barclays Private Clients International Limited in the Isle of Man, Jersey and Guernsey. For further information on these companies and Barclays please read the Important Information.