1300 779 106Overview
Why risk management matters
Smart Currency Business works with Australian companies to build tailored currency risk management strategies. Our team prioritise protecting margins, stabilising cashflow and creating the budget certainty that finance teams and boards require.
We start by understanding the specific economic and business risks your company faces, then evaluating their potential impact on your P&L and balance sheet. Only then do we recommend an instrument mix and hedging approach.
Understanding different types of currency risk
There are three main risks that Australian businesses operating internationally face:
Transactional risk: The exposure created through regular business activities: payables to overseas suppliers, receivables from exported goods and services, international intercompany payments and funding or dividend flows from overseas operations. This is the most common and most directly manageable form of FX risk for Australian businesses.
Translational risk: Arises when companies with overseas subsidiaries or assets need to translate foreign-currency values into AUD for consolidated financial reporting. Exchange rate movements can materially affect reported earnings and shareholder equity, even without any actual cash movement.
Economic risk: The broader exposure created by macroeconomic conditions. This includes commodity cycles, interest rate differentials, trade policy shifts and geopolitical developments that affect the competitive position of your business in international markets.
Our approach
We conduct a thorough review of your exposures across all three risk categories, assessing volume, timing, currency mix and the sensitivity of your margins to rate movements. From there, we design a hedging programme that supports your core objectives and scales as your exposure profile evolves.
Critically, we provide ongoing support. Markets move, business conditions change, and your hedging strategy needs to adapt accordingly. We work with you continuously to monitor, review and refine.
What makes us different
SmartHedge PRO
SmartHedge PRO is our currency management platform that makes tracking exposures simpler than ever. Developed and tested to address pressing challenges growing companies face, SmartHedge PRO offers automated solutions that allow business to spend less time pouring over spreadsheets and more time making the decisions that matter.
How we work
Trading with us is simple
Follow our streamlined steps to navigate currency markets effortlessly.
Open an account
Opening an account with Smart Currency Business is simple.
Quick and easy
Complete the enquiry form below, or give us a call.
Guided process
Our team will be happy to guide you through the process.
Frequently Asked Questions
What is a currency risk management strategy?
A structured plan to identify your FX exposures, assess their potential impact on your business and implement hedging solutions that protect your margins and cashflow from adverse exchange rate movements.
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Why is a formal hedging policy important?
A hedging policy provides a disciplined, repeatable framework for managing FX risk. It ensures consistent protection, reduces emotional decision-making and creates clear accountability, all of which can be communicated to boards and stakeholders.
How do I identify my business's currency risk?
Start by mapping your international cashflows. This includes who you pay, who pays you, in what currencies and on what timelines. We then assess transactional, translational and economic risk to determine where your margins are most vulnerable.
What is the difference between active and passive hedging?
Passive hedging applies a fixed percentage of cover across your exposure, prioritising stability and simplicity. Active hedging allows for tactical adjustments based on market outlook and budget rate performance, potentially improving the blended rate achieved.
How does risk management improve business forecasting?
By fixing exchange rates through hedging, you remove currency volatility from your financial models. This leads to more accurate budgeting, reliable margin projections and more confident long-term planning.
