Research On The Problems And Countermeasures Of Exchange Rate Risk Management Of L Company

With the vigorous development of China’s foreign economy,China has become one of the most important trading powers in the world.Although protectionism,represented by the Trump regime in the United States,has risen in recent years,there is growing interdependence among the world’s economies,and international cooperation at the bilateral,multilateral and regional levels remains the dominant trend.As early as 2001,China was joined the World Trade Organization(WTO).Today,a floating exchange rate system based on market supply and demand,adjusted by reference to a basket of currencies,has been established and constantly adjusted and improved.In the context of full current account convertibility and deep capital account opening,more and more Chinese companies are joining the world economy.However,due to the late start of China’s foreign trade,the US dollar World Trade pattern is still strong.Chinese enterprises mainly use dollar-based foreign currency pricing and settlement in their foreign operations,so they are bound to face the risks caused by exchange rate fluctuations.Strengthening the management of the risk of exchange rate fluctuations is of great significance for enterprises to control risk,strengthen financial stability and enhance competitiveness.It is an important direction in the study of management theory and empirical evidence of multinational management companies.This paper adopts the method of combining theoretical analysis with case analysis to study.In terms of theoretical analysis,the paper summarizes the existing research on exchange rate fluctuation theory and exchange rate risk management by means of literature review.In the empirical analysis,I chose a private enterprise in Jiang su Province to conduct a comprehensive analysis of its exchange rate management and related financial conditions in the past three years.This article is divided into five chapters.The first chapter is mainly an introduction.It summarizes the research background and significance,literature review,research ideas and framework,research methods and innovation points.The second chapter expounds the theory of exchange rate fluctuation,exchange rate risk and exchange rate management According to the existing research results;The third chapter takes L company as an example,based on its exchange rate management measures and financial data in the past three years,and summarizes the existing problems after analysis;The fourth chapter takes the case of L company to improve its exchange rate risk management.The fifth chapter is the conclusion,research prospect and related suggestions.After research,his paper believes that L company has many problems in exchange rate risk management,This paper attempts to rebuild the exchange rate risk management mechanism and alternative management means for L company,hoping to provide reference for Chinese cross-border business enterprises.