• Sat. Mar 2nd, 2024

Reducing Risk: Financial Coverage Focuses on Exchange Rate, Interest Rates in 2024


Feb 12, 2024
Currency risk and high rates are the main focus of hedging contracts

In 2024, financial coverage to reduce the risk of investors in retail or institutional, such as Afores or investment funds, will focus on the exchange rate (peso-dollar) and interest rates, predicts José Miguel de Dios, general director of the Mexican Derivatives Market (MexDer). The director of the derivatives exchange in Mexico assured that in this election year and interest rate movements, investors will use exchange rate and interest rate futures or options to cover their risks of shocks in the exchange rate.

The volatility that will be generated by the elections in Mexico and the United States, as well as the start of the first decreases in the central banks’ reference rates will begin to generate volatility in investors’ portfolios. This will be a year of extreme volatility in the financial market, which raises the possibility of high fluctuations in the assets of retirement workers and retail investors, mainly due to the fact that there will be presidential elections in Mexico and the United States.

In 2023, Mexican peso futures contracts on the Chicago Mercantile Exchange (CME) Group reached a record average daily volume. The continued growth of

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