PNC offers a full range of FX services
Foreign exchange hedging tools can help you manage foreign exchange risk more effectively, secure pricing and costs, and potentially increase profits and reduce expenses. PNC's dedicated team of senior foreign exchange consultants can help you identify exposures and determine the appropriate risk management tools to effectively hedge global risk, enabling you to benefit from favorable market conditions.
Customized solutions include:
Why Foreign Exchange Options Should be Considered as Part of Your Company’s Risk Management Program
Condensed from an Advisory Series Webinar, this presentation explains various types of options and the pros and cons of each.
Enjoy presentation material recorded October 8, 2015 Watch Now »
A contractual obligation to buy from or sell a fixed amount of foreign currency on a future maturity date at a predetermined exchange rate.
Forward contracts can be customized in a variety of ways. All forward contracts protect against adverse currency fluctuation by locking in an exchange rate. However, customized product structures provide for flexibility in timing and hedging opportunities in regulated markets.
Global business exposure requires you to hedge your currency risk; however, you want the opportunity to achieve some benefit from a favorable move in the currency markets. A collar or enhanced collar, which can be structured with no upfront premium, may be the answer.
Your company protects against a strengthening euro by executing a collar with a 1.10 floor and 1.15 cap expiring on June 29. If at expiry the EUR spot is:
Global business exposure requires you to hedge your currency risk, but you still want the opportunity to benefit from a favorable move in the currency markets. A participating forward contract may be the answer.
Overview of a Participating Forward Contract:
A collar is similar to a participating forward similar contract and provides protection against unfavorable currency fluctuations, while allowing limited participation in favorable market movements up to a predetermined level or cap.
Your company protects against a strengthening euro by executing a participating forward contract with a 1.15 cap and a 50% participation level expiring June 29. If at expiry the EUR spot is:
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Allocation of Callable Securities Your account may contain “callable” securities, which allow the issuer to repurchase or redeem the securities by a specified date. In the event of a partial redemption or call of securities by the issuer, PNC Capital Markets LLC will allocate among its customers, the securities being selected as called, on a fair and impartial basis through a randomized lottery system. If your account contains callable securities subject to a partial redemption or call, the probability of your securities being selected as called is proportional to the holdings of all customers of such securities held in bulk by PNC Capital Markets LLC. Notwithstanding the foregoing statements, PNC Capital Markets LLC will further ensure equitable allocation of the callable securities by excluding itself as well as its interested persons from the lottery system when the redemption is made on terms that are favorable to PNC Capital Markets LLC; and including itself as well as its interested persons in the lottery system when the redemption is made on terms that are unfavorable to PNC Capital Markets LLC.
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