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International trading systems, also known as derivatives, have become the way of doing business and managing risk in an increasingly global economy. In the early 1970’s business was very internal or national in scope. International money markets operated on a fixed exchange rate system called Bretton Woods.
When the fixed-exchange rate system failed it created the need for foreign-exchange futures to manage the risk of the changing relationship of international currencies. Without international trading systems, companies doing business worldwide would have no idea of costs when currency values could change dramatically between the time it bought a product or services and when it was delivered and had to pay for it.
Foreign–exchange futures allow companies doing business internationally to lock in a value for currencies months in advance. Today companies are also subject to interest rate risk. Here again, global businesses depend on international trading systems, or financial derivatives, to lock in the value of interest rates months in advance.
Thirty years ago international business was mainly reserved for Fortune 500 type businesses. Today, with the advent of the Internet even small “ma and pa” type operations are doing business internationally. It is essential that they are able to manage their risk through derivatives. The development of derivatives between North America and Europe has been well established as a critical element of doing business over the last two decades but Asia is lacking in this development. For two major markets, India and China, this development is just beginning. The implementation of risk managing derivatives for these two great markets will be the challenge for international trading systems for the next decade.
Regardless of the size of your business Worldwide Futures Systems has the experience and the “know how” to set up an international trading system operation that fits the needs of your business. Worldwide Futures Systems is a leader in managing the risks of doing international business through derivatives.
Please contact us at 888-989-WWFS for a no obligation consultation on how we can help protect your company’s international operations.
