The Indian MSME sector is considered to be the backbone of the Indian economy. As per reports, it accounts for around 8% of India’s GDP and 45% of the country’s exports.
With the volume of foreign trade increasing, the volume of transactions too has increased manifolds. Consequently, importers and exporters felt the need to invest in hiring forex expert advisor to start trading in gainful ways and build wealth rapidly for future expansions. The problem with high street bankers is that they do not offer MSMEs the much needed support that they are in dire need of. Sadly most of the decisions of the importers and exporters are more instinctive than data based on market movement. They are unable to read the math of price fluctuation, volatility of currencies and other indicative factors as they are no forex experts.
Eventually, uninformed decisions taken up by exporters and importers cut out their chances to avail the potential benefits of the currency rate movements at the right time. Worse so, it often leads them to face huge losses as they are unable to predict the underlying risks facing their forex exposure, assets, net profits and liabilities. So is there a way out to address this issue? Well the answer to it is ‘Yes’ and without any second thought availing Forex Services offered by a credible Fintech Company is the best and wiser solution. Needless to say, through adequate consultation on foreign exchange management any business- whether small or large has always managed to function adequately staying on the right track.
Personalized Assistance & Advisory- After understanding the needs of the businesses and after having studied each business’s forex portfolio management, forex experts offer personalized assistance to the MNCs and MSMEs.
In the area of foreign currency buying and selling, it involves unpredictable risks due to the volatility of the forex market. Before making any transaction, the Forex experts generally make use of the signal system in order to make any decisions. The technical analysis is one of the determining areas where companies can benefit immensely by outsourcing forex services offered by experts of the field. It is this technical analysis on current events which helps consultants offer valuable advisory to their clients.
No advice is given on mere speculation or on instincts. They carefully understand the driving factors of the market actions, the relationship between the markets and how any slightest movement in one market could inversely affect the movement of the other markets. Further, the currency trends are studied carefully, the technical indicators like support as well as resistance levels are observed to predict the buy and sell signal. The forex experts making use of the latest technology based algorithms study the past price movements in order to determine the currency movements.
A lot also depends on timing the trade after closely monitoring the turning points on the longer timeframes and vice versa- switching down to shorter time frames in order to fine tune any entry. Both fundamental and technical analysis requires a great deal of patience, focus and time to help any business manage their forex portfolio in the desired direction. Thus, outsourcing the service with help from Forex experts in this area is not a short term benefit but one that can help businesses in the long run.
Risk Management Assistance- This is one of the most fundamental aspects to helping businesses in managing rate risk exposure and reducing vulnerability of the organizations to major exchange rate movements that affect profit margins and the value of organization’s assets.
The first thing which forex advisors perform when helping organizations manage forex risks is identifying the three main types of exchange rate risks. Transaction risk, translation risk, economic risks are three types of exchange rate risks which import or export businesses face while they are transacting foreign exchange.
In case of investors or companies having assets or business operations overseas, they are bound to face currency risk if their positions aren’t hedged. Measuring both currency risk and economic risk is most crucial to hedge. Here again, the expertise of forex advisors hold immense importance as they are able to translate effectively the market moves and thus identify devaluation of foreign currencies which lead to a devaluation of the foreign exposure.
Hedging is considered to be a compulsory aspect to maintain the financial health of the businesses. Various financial instruments like future, forwards and options help minimise risks related to forex exposure and assets. However, the hedging instruments cannot be randomly utilized. It requires a lot of understanding from a particular business’s point of view and based on such, offer an ideal hedging suggestion.
Managing Forex Accounts Assistance- Forex account management is a daunting task as this too, like technical and fundamental analysis of market requires a lot of patience and dedication. Thus for the businesses who lack adequate knowledge, experience and time to manage forex accounts, having a professional trader to manage accounts on behalf of the business is ideal. The forex account managers with their expertise in the field know how to read through the volatility, political turmoil and economic events and take steps that are emotionally balanced even when the market is really adverse.
Thus, rather than putting the trading skills at test and making situations really taxing for the businesses, it is always a wiser move to go for professional forex services offered by recognised service provider. No financial experts offering consultancy to international trade businesses will ever take rash and biased steps on behalf of any client. Their simple objective is to help businesses grow by mitigating risk and in turn diversify their clientele portfolio. Think about it!
29 Jun 2020 05:35 PM
Dynamic hedging is a foreign exchange risk management strategy that allows businesses and individuals to readapt their hedging positions to evolving market conditions by providing flexible solutions to protect investments from exchange rate risks.
19 Jun 2020 05:01 PM
Management of Currency Exchange Risk is of paramount importance during turbulent times, like this pandemic. The currency fluctuations are very volatile and cannot be predicted as the circumstances are uncertain.
06 Jun 2020 03:59 PM
Outrights, in FX markets refer to the type of transactions where two parties agree to buy or sell a given amount of currency at a predetermined rate, on a specified date in future.
08 May 2020 05:21 PM
Converting one exchange rate into another at a particular price makes transferring rates. Ideally all nations should be treated as equal and there shouldn’t be any exchange rate applicable which would mean to have a universal currency.
24 Apr 2020 03:08 PM
Managing risk in a financial market is required to keep a check on the adverse movements in the instrument of the market. Particularly in the foreign exchange market.
10 Apr 2020 06:12 PM
So was India’s decision on locking down the country for 21 days required? The implication on the economic growth or rather slowdown has only made many doubt the timing and preparedness of the decision.