Forex Hedging is nothing different to the basic definition of hedging. In it, currency of two or multiple countries is hedged to minimize the risk of future losses arising due to currency price fluctuation. Hedging is also approved by IFRS (International Financial Reporting Standards) and US GAAP (US Generally Accepted Accounting Principles) which allows accounting for the profits and losses made from such activities. These two entities have their own guidelines for accounting of derivatives. In IFRS, the hedging can be done by two methods, via; Cash Flow Hedge and Fair Value Hedge.

With the increase in the cross border business, the need and use of currency hedging has increased immensely. Almost all the companies having cross border business have deployed specialized teams to predict the currency value movement and accordingly hedge their exposure to reduce their losses. These specialized teams include people like CPA, CFA, MBA Finance, Currency professionals, economist, etc., who in combine effort deals with this risk. Also, on other hand increasing demand of such professionals have given these professionals an opportunity to be self employed and make their own investment in Forex market, become currency investment guide, etc. The combination of the above two facts determines the growth of Forex exchange round the globe.

The growth of this market has brought in the high demand for forex brokers without whom individuals and small companies cannot trade in currency. High Net worth Individuals and big MNC's can get currency trade felicitation from banks but the increasing competition and high end researches have made the brokers favorite choice over banks. It is very important to keep in mind the below mentioned points before choosing a broker;

• The registration country of the broker as many countries doesn't have the privilege of trading in all currencies which will limit exposure to trade in limited currencies.
• Deposit, withdrawal, broker commission, initial start up amount, etc. Should also be considered as per the requirements, volume and frequency of trade.
• One should give high importance to the trading platform provided by the broker/the broking company because the trading platform plays important role in trade execution rate.
• Reputation of the broker, his customer service and trade execution are other important parameters to be checked to assure high speed and secure trading experience.

There are other aspects also promoting the growth of Forex hedging such as 24 hours market allowing starting side income to the experts to earn during non-office hours. High end research reports, multiple factors of movement in currencies, brokers help in placing orders, e-books and guides easy availability to learn Forex trading etc. This makes forex hedging a challenging game for everyone to top the list in their own field of activities.

CL King and Associates (http://www.clking.com/) provides investment banking, equity research, sales and trading, and investor services to corporations and institutions. CL King’s Corporate Services unit offers specialized services and objective advice to help corporate clients achieve flawless execution directly in the capital markets.