Case Study On The Exchange Rate Risk Of CK Company

Today,China is actively promoting the national strategy of Guangdong,Hong Kong and Macao Bay area.As the bridgehead of China’s opening-up,Hong Kong still plays an important role in China’s Pan Pearl River Delta regional’s cooperation.Due to the objective reasons such as the economic business environment,the convenience of policies and the less restrictions on the entry threshold of listing,a large number of domestic enterprises have chosen to register and list in Hong Kong.This paper takes CK company,a leading manufacturer of mold and injection molding products,as an example to study the exchange rate risk faced by exportoriented enterprises.As a powerful manufacturing country,China’s mold and injection molding market has been saturated in recent years.With the development of foreign markets and the policy guidelines of "The Belt and Road Initiative;" and "the Guangdong-Hong Kong-Macao Greater Bay Area Initiative ",many domestic enterprises have begun to go abroad and set up overseas departments in overseas markets.However,opportunities are always accompanied by risks.When Chinese export enterprises go abroad,they will inevitably face foreign exchange risks in international trade.Facing complex foreign exchange market,due to frequent foreign capital activities,enterprises have a large amount of foreign exchange risk exposure for a long time,while enterprises are often business-oriented management of funds.Under the influence of exchange rate fluctuations,enterprises often suffer varying degrees of losses.In order to protect the business results of enterprises,how to effectively adopt scientific management means to deal with and transfer funds while ensuring the safety of funds The existing risk is an urgent problem for Chinese export enterprises.Based on the brief introduction of exchange rate risk management theory and related literature,this paper introduces the exchange rate risk faced by CK company from three aspects of translation risk,transaction risk and economic risk,and analyzes the specific measures taken by CK company in response to exchange rate risk from the perspectives of financial hedging and operational hedging,and explores a set of methods suitable for CK company by combining theoretical cases The company’s foreign exchange management system can help related industrial enterprises to avoid and deal with exchange rate risk,improve management efficiency,and improve business results.At the same time,it also enriches the relevant theories of exchange rate risk,and has certain reference value for other export-oriented companies.Of course,there are limitations in this paper,such as due to the distinct business characteristics of the mold and injection molding industry,so the corresponding measures to deal with exchange rate risk may be limited to other industrial products.