Currency Hedging Cost Calculator
It buys certainty, not profit.
Exchange rates move constantly and no rate is stored here — enter the current mid-market rate from a source you trust. Everything below is arithmetic on the rate you provide.
Cost of hedging
2,822
protects 17,640 of downside
Hedging costs 2,822 to remove 17,640 of potential downside — it buys certainty rather than profit. A hedge that turns out to have been unnecessary was not a mistake, which is the hardest part of the discipline to hold to.
How the Currency Hedging Cost Calculator works
Hedging buys certainty rather than profit, and a hedge that turns out to have been unnecessary was not a mistake. Holding to that is the hardest part of the discipline and the reason most small businesses abandon it after one good year.
Not financial advice. Marketplace fees change, and they vary by country, plan and seller status. Every rate here is an editable default, not a quoted price — check the platform's current fee schedule before you price a product against it. This is not tax or business advice.
Frequently asked questions
What does hedging cost?
The forward premium or discount, which reflects the interest rate differential between the two currencies. It can be a cost or a benefit depending on direction.
How much should I hedge?
Commonly 50% to 80% of known exposure. Full hedging removes all upside as well as all risk; partial hedging is the usual compromise.
What instruments are available?
Forward contracts are the simplest — a fixed rate for a future date. Options cost more and preserve the upside. Most small businesses should start and finish with forwards.
Should a small business hedge at all?
If FX exposure is material relative to profit, yes. If a 5% move would not change any decision, the administration is not worth it.