Insights

FX Overlay Solution (FXO)

MUFG Investor Services’ FXO provides an outsourced, non-discretionary, rules-based hedging service, addressing clients’ challenges when mitigating FX exposures within a portfolio or hedged share classes.

Would you like to:

  • Reduce operational and market risk by outsourcing some or all parts of your currency hedging program to MUFG Investor Services?

By outsourcing some or all parts of the currency hedging program to MUFG Investor Services, operational and market risk can be reduced.

Our offering is fully automated, flexible, cloud-based and adheres to best execution principles, allowing for both benchmark execution and competitive auction execution while tailored to every aspect of your FX hedging mandate.

  • Improve FX execution efficiency and obtain full price transparency on execution?

We guarantee the pricing on rates; trading is executed directly from our centralized operations center in Cayman resulting in costs savings versus models that ‘pass the FX trading book’ to a third party.  

  • Increase the ability to diversify your fund offering in more regions, thus increasing distribution to expand and develop a global investor base?

Specializing in both share class and portfolio hedging allows us to offer our clients extensive distribution methods to diversify fund offerings across regions.

Although bundling our FX Overlay services with our world-class administration offering results in a complete back to front operational model, we are equally able to offer this on a standalone basis allowing our clients to retain their chosen providers (whether cash management providers, prime brokers, custodians) and still achieve a high degree of automation relating to portfolio or share class hedging.

  • Tailor every aspect of your FXO program, including hedge ratios, hedge frequency, NAV triggers, tenors and execution methodology?

We work with each of our clients to build a hedging model that is tailored specifically to satisfy their specific hedging requirements. We use market-leading tools in our service offering with over 73 technological variables that are fully automated, redundant and secure with multiple levels of oversight to ensure accuracy.  Once the FX hedging parameters are agreed, we interact with our clients as a Riskless Principal.

We look forward to discussing how we can deliver not only an outstanding product but an excellent client experience.  

Please contact Hans Jacob Feder, Global Head of FX Services, to find out more about our offering at HFeder@mfsadmin.com.