Currency Exposure
a.k.a. FX exposure
How much you stand to gain or lose from moves in a particular currency.
In plain English
How much you stand to gain or lose from moves in a particular currency.
Currency exposure is your sensitivity to a currency. A trader long EUR/USD and long EUR/JPY has double exposure to the euro. A British company selling in America has dollar exposure.
Adding up exposure by currency, rather than by trade, shows where your real risk sits. It is the starting point for hedging.
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