currency fluctuations

[MrJuice]

Hello!

I used to buy a fair number of euros every month to buy stock for my business. I only recently started doing this and the rate has always hovered around 1.40 euro for each £ in that time.

Now the rate is 1.29 and so more difficult to make profit.

What financial instruments could I use to soften any drop in the value of GBP? The way things are, I cannot tie up capital for more than 1-2 months. Obviously one solution would be to buy a lot of euro when the rate is good but unfortunately my pockets are not that deep.

[Super Slo Mo]

The only thing I'd say is that you got very lucky with the 1.40 exchange rate.

Based on the last few years, even 1.29 is pretty good.

Edited for sausage fingers

[Ozzie Osmond]

The catch with "hedging" is that like every other kind of insurance it has a cost attached to it. And if you're already trading with marginal profitability that might simply make things worse.