The general myth in Foreign Exchange is that one cannot possibly achieve peace of mind when dealing with currency market volatility. No one knows the events that are going to occur in the future and thus, no one can predict in which direction exchange rates would move – let alone the magnitude of those movements. Navigating through FX markets becomes like navigating through a jungle. We don’t know what we are going to find in the jungle anymore than we know what is going to happen in FX markets.
So, with keeping the above in mind, can one navigate through FX markets successfully every single time? We have seen on numerous occasions, explorers who have successfully navigated through vast, dangerous and relatively unknown territories. How have they been able to achieve a high rate of success? Simple… they planned before they begun their journey. They developed a road map – a map to turn to whenever they were lost. A map that reinforced their overall destination and their relative position to it. By following this map, these explorers where able to correct their direction logically and systematically without allowing emotions and spontaneous decisions to govern their progress.
In Foreign Exchange, it is important for companies to understand the destination they wish to reach – that overall result that they would want to achieve from all their foreign exchange activities. It is only with these objectives in mind, can a company design a plan, a road map, that will assist them in navigating currency markets. With this plan in place, companies would be able to achieve peace of mind in an industry where it seems to be just a myth. Companies would be able to protect their bottom line in such a manner, that the cost for such protection is feasible to the business.