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Risk Management

Risk Management
Price hedging is an important risk management tool when it comes to the procurement of precious metals. Since the financial crisis of 2008, precious metal prices have become increasingly volatile. This poses a tremendous financial risk, especially for industrial end users whose margins can be negatively impacted by such fluctuations.
Heraeus Precious Metals Trading offers hedging services that are tailored to the specific needs of our customers, helping them manage the inherent risk of precious metal markets.
Depending on your requirements, we use the following price hedging instruments:
Forward Transactions

Forward Transactions

A forward transaction is the purchase or sale of a certain quantity of precious metals at a pre-determined price at a defined point in time in the future.

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Option

Options

By buying an option, a buyer acquires an "insurance" protecting it against unfavourable price movements. As the buyer of an option acquires a right to exercise it but has no obligation to do so, it can still benefit from advantageous prices that may occur during the term.

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In addition, we offer the following transaction types and services:
Cash Transactions

Cash Transactions

In a cash, or spot, transaction, a precious metal is bought or sold at the current price. The mutual obligations (payment and delivery) are discharged two days after conclusion of the contract (value date).

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Limit Orders

Limit Orders

If a customer plans to buy or sell a precious metal but cannot check the metal markets all the time, Heraeus provides the option of placing a limit order (also called order).

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Swap

Swap

Swap means the swap of a payment flow (cash settlement) or metal on the one hand, and its equivalent value in the form of money (physical settlement), on the other.

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