Selection Of Foreign Exchange Risk Management Tools

The foreign exchange risk is one of the important risks that Chinese import and export enterprises face,and it is an important factor affecting the income of enterprises.Modern enterprises in the import,export and overseas business investment are facing a full range of foreign exchange risk.For a long-time,the level of Chinese enterprise foreign exchange risk management is insufficient.In addition,Chinese enterprise failed to choose the appropriate foreign exchange risk management tools.In recent years,the foreign exchange risk management of enterprises has been paid attention by scholars;however,the research on the selection of foreign exchange risk management tools in China is still in the initial stage.In view of this background,this paper believes that it is theoretical and practical to study the selection of foreign exchange risk management tools on a specific enterprise.This paper takes the Chinese construction machinery industry leading enterprise Zoomlion Heavy Industry Science and Technology Co.,Ltd.,to be the empirical analysis object,and conducts a study on the selection of its foreign e xchange risk management tools.This paper first expounds the foreign exchange risk management tool and the foreign exchange risk theories,which lays the theoretical foundation for the practical analysis.Then to analyze the usage of foreign exchange risk management tools.Moreover,quantitatively using the grey correlation method to analyze the use of the foreign exchange risk management tools.The selection of success of the foreign exchange risk management tool was successfully but still can be improved,including the zoomlion failed to proactively in the foreign exchange management tool used to choose foreign exchange management tool,select only a single financial tools,lack of foreign exchange risk managers or staffs,etc.Finally,based on the above analysis,the analytic hierarchy process and successful cases are used to propose and demonstrate that option is one of the best options for zoomlion’s foreign exchange risk management tool.This paper attempts to use Zoomlion as an exampl e to provide analysis and decision-making basis for the choice of foreign exchange risk management tools.