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How to Communicate to a Board Regarding Hedging Risk with Derivatives?

MINNEAPOLIS, MN | February 24, 2023 |By: John Trefethen, Director and Co-Founder

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How to communicate to a board regarding hedging risk with derivatives

What messaging should be communicated to a board regarding hedging risk with derivatives?

  • Hedging is for preventing an existing risk from impacting earnings

  • Hedging is not speculation

  • Hedging is an exercise to manage market volatility

  • Hedging offers protection against undesired market fluctuations

  • Hedging is an activity taken on by institutions that are risk adverse

  • Not hedging is speculating

Being sure that a board understands what hedging is, and is not, is the first step in preparing them to make an informed decision about hedging.

HedgeStar can guide companies wherever they start in the hedging lifecycle. Providing support from risk governance, systems, accounting and special projects.

What to learn more about hedging risk with derivatives? Contact HedgeStar today:


Contact the author:

Mobile: 612-868-6013

Office: 952-746-6040

John Trefethen co-founded HedgeStar (formerly DerivActiv) in 2004. John has 30 years of experience in capital markets where he has held various positions related to institutional debt issuance, executing hedging strategies, and designing and implementing derivative reporting solutions. John has presented to numerous industry groups on various topics related to hedging financial risk, and accounting for derivatives.

HedgeStar Media Contact:

Megan Roth, Marketing Manager

Office: 952-746-6056

Laura Klingelhutz, Marketing Generalist Intern



HedgeStar supports hedging programs for Interest Rates I Currencies I Commodities


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