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The Next Generation of Currency Hedging Strategies

Protect your international business from foreign exchange risk in volatile currency markets by using the next generation of hedging strategies and tools to implement risk management strategies for your cross-border transactions.

 

You can reduce FX risk, stabilize costs, attract foreign investors and boost returns

Our global client base has +$40bn AUM and our clients save on average 65% on the FX fees when switching to work with us. Our hedged share classes have raised more than $750m from foreign investors for our clients.

Advanced Foreign Currency Hedging Strategies

Why Global Businesses Use FX Hedging 

Lower Costs

We have saved our clients millions in spot and hedging costs 

Attract More Investors

Through our foreign share classes, our clients raised 300% more from their foreign investors

Stabilize Returns

Using our long terms hedging strategies our clients effectively estimate their returns with ease.

Boost Returns

Our hedged share classes outperform unhedged share classes in positive, neutral and negative market skews.

Fx Monte Carlo Simulation hedging strategy

FX Market Simulations

Simulation types include geometric Brownian motion, stochastic volatility and jump-diffusion models. The market models may include skew (client predilection of market trends), and kurtosis (ie fat tails), to model upcoming impactful events.

Our Monte Carlo simulation engine can simultaneously model multiple strategies including forwards, vanilla, exotic options and the likelihood of a margin call.

Strategy Evaluator

Graphical displays of the outcome distributions for each Hedging strategy make it easy to intuitively grasp the relative performance of multiple strategies and effectively communicate the findings to investors.

FX Hedging Strategy Comparison Graph
Foreign Exchange Hedging strategy on the Efficient Frontier graph

Hedging Multiple Simultaneous Exposures

Our program uses constrained optimization to identify the efficiency frontier, which consists of total hedge cost/portfolio VaR pairs.

 

The efficiency frontier represents the lowest portfolio VaR for a given total cost, or conversely, the lowest total cost for a given portfolio VaR.

Deaglo Saves client $4m in International Port Investment

Background:

A US investor purchased a share of a port operation in Brazil in summer 2020. The Port was BRL-functional. In order to conform to international convention, grain-loading contract tariffs were priced in USD. 

The investment horizon was five years with the following projected cash flows:

  • The initial outlay of $75M USD

  • Annual operating flows of approximately $5M-$10M

  • Estimated proceeds at the end of year five - $150M

Approach:

Deaglo took a Monte Carlo modeling approach to evaluate and select the optimum option strategies for each tranche. By modeling the spot market over tens of thousands of runs and evaluating the resulting gain/loss of the exposure and multiple option strategies, and using visualization techniques from the statistics world (box and violin plots), it became easy to compare and select a strategy. 

Results:

Deaglo saved the client $4m over 5 years and reduced 'Value at Risk' by 70-75% at minimal cost using a tailored strategy.

Container Ship

How it Works

1 - Book a Free Consultation

Get in touch through our website and one of our experts will respond shortly.

2 - Quantify your FX Risk

Our experts will learn about your business or foreign investments, identify your currency exposure and help you to understand it's implications.

3 - Reduce your FX Risk

Using our proprietary technology, we'll compare and contrast different strategies that will reduce your risk and boost returns. 

Who Do We Work With?

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Fund Managers

We work with leading Fund Managers with global investment mandates. Our alternative banking solutions were created specifically for our Private Equity, Venture Capital, Real Estate and Private Debt clients. 

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Institutional Investors

We work closely with LP's including Foundations, Endowments, Family Offices and HNWI. 

Corporates

We understand how corporates must manage and account for FX risk, whether it be forecast or booked items. 

What our Clients Say

Credit Fund, Latin America

Deaglo not only provided us with a flexible strategy that fit all our requirements but helped to communicate this strategy to investors and stakeholders. They were a key reason to our success in raising +200% more capital than expected.

Insitutional Investor, North America

We were purchasing an asset overseas with multiple different revenues flows. Deaglo's team identified where we would be able to take advantages of natural hedges and off-set some of our costs. Their work made the asset more valuable.

VC Fund, Europe

Deaglo showed us that on €4m worth of FX transactions, they would be able to show us €60m+ in fee savings. We didn't even know we were being charged that much in the first place.

Why Deaglo?

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$750m raised into Deaglo supported share classes

65%

Average reduction in FX costs

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$40bn + in client AUM

$1bn+ worth of annual FX Flow

 
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The next generation of FX risk management is coming soon.