How a Simple Trading Tactic Saved Thousands of Dollars in 1 Year

Posted by Olympia CGP on 3/30/20 11:03 AM

LivestockA family owned and operated livestock company has been in business for 24 years. They are a tough group of proud Albertans that work hard every day. The business has been successful, and they produce strong and healthy animals for export to the US every year. 

The Challenge

Market volatility and fluctuations in the exchange rate between the Canadian and US Dollar left them vulnerable and exposed to serious losses in profits on their sales to the US market. The bank that they were using had never explained their options and they were unaware that they had the ability to manage their foreign exchange needs in order to completely mitigate their risk of profit losses.

The Solution

The company’s management and accounting teams met with Ross Lynch, Senior Currency Analyst, for a consultation. Ross asked the right questions to understand their needs and developed an appropriate hedging strategy that would minimize the risk of profit losses. Olympia Trust Currency & Global Payments has a variety of solutions and products available to assist in these types of situations.

The Result

Ross employed a combination of Market Orders and Forward Contracts in order to minimize the company’s foreign exchange risks and allow them to capitalize on the best rates available at that time. This tactic and strategy allowed the company to set target rates and book those rates for future settlement.  Profits were now locked in and guaranteed for the year of sales & exports to the US. In this particular year the US Dollar had dropped more than 10% but the company was protected and saved over $680,000.00.

Conclusion

5 years later, this company continues to rely on Olympia for their annual hedging strategy and considers us one of their most valuable business partners. 

There are many businesses and organizations that are still unaware of the options available to them.  Simply planning ahead can add significantly to your annual profit margin. Ross Lynch is available anytime to discuss your business needs and show you the most effective foreign exchange solutions to mitigate risk and protect your profits.

avatar-2 For more information or to schedule a free consultation, contact Ross Lynch.
E: lynchr@olympiatrust.com
P: 1.866.752.7135

 

Topics: Case Studies

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