• Professional currency risk management
• Clear operating processes
• Transparent performance reporting
• Attractive fees

1. Currency risk analysis
An accurate analysis of the client's portfolio is the first step to achieving the desired goal of professional currency risk management. The analysis pinpoints potential risks, and thus forms the basis for advice that enables clients to define a strategy precisely attuned to their needs.

2. Implementation of the chosen strategy
The next step in professional risk management is operational implementation based on clearly defined processes and guidelines. This ensures that both strategy and solution genuinely meet the client’s expectations.
 
3. Monitoring
Ongoing implementation of the currency risk management mandate takes account of compliance with specific risk parameters defined in close consultation with the client. These may, for example, stipulate minimum/maximum bandwidths for hedging levels, maximum cash outflows, maximum losses per currency position, value at risk and tracking error.

4. Reporting
With Quaesta Capital’s transparency service, you can find out exactly how your investments and hedging strategies are performing at any time. Our clients appreciate customized performance reports that they can access whenever they need them.

The choice is yours:

Passive FX risk management
Quaesta Capital’s currency manager is the perfect tool for eliminating the unwanted currency risks of foreign investments, enabling you to maintain a hedge ratio as close as possible to your agreed level.

The hedge ratio is influenced by numerous factors: the client’s willingness to take risks, the correlation between the various investments and currency movements, the interest rate differentials between the currencies involved, transaction costs, the investment horizon and the frequency of changes to the portfolio.

Quaesta Capital’s passive currency risk management also aims to reduce transaction costs and provide client-specific management of the resulting cash flows. Here too, clients benefit from the vast knowledge and extensive experience of Quaesta Capital’s specialists.

Coupled with FINMA-regulated internal risk management processes and access to competitive transaction fees for institutional investors, it adds up to a compelling and profitable argument for working with Questa Capital.


Active FX risk management
Active FX risk management from Quaesta Capital is the perfect solution for reducing risks and simultaneously boosting portfolio returns. A combination of passive risk management and active management of the hedged positions enables you to take full advantage of favourable currency movements.

Risks are monitored continuously according to a number of parameters, to ensure that the currency risk of an active mandate never gets out of hand. The parameters are agreed in consultation with the client. Chief among them are value at risk, tracking error and risk budget approaches. Deliberate deviations from these passive hedging limits are permitted in order to exploit the currency strategies of a mandate for active currency risk management.

Quaesta Capital offers the following active profit strategies:

Dynamic hedging

• Managing existing currency risks by increasing or reducing the hedging limit in response to market sentiment
• Limiting risks by defining the permitted deviation from the agreed hedge ratio (relative, absolute, tracking error limit)
• Limited use of return potential by trading only hedged currencies in the portfolio

Portable alpha

• Dividing the portfolio into a beta component (currency risk of the passively hedged portfolio) and an alpha component (tailor-made currency universe and guidelines)
• No link between the currencies in the portfolio and currency activity to generate returns
• Return potential of the entire currency market