Positive M&A outlook could boost deal contingent hedges
Traders predict hedging activity linked to deal completions will take off this year
Dealers expect an increase in deal contingent foreign exchange hedging activity in 2025, in conjunction with heightened takeover deals from corporates and private equity firms in the latter part of the year.
“We’ve certainly seen an uptick in deal contingent hedging,” says Edmund Carroll, head of FX, rates and commodities corporate client solutions at UBS. “Compared to 2022 the number of DC trades is magnitudes higher now, simply because of the far higher deal flow.”
As of March 4, the total year
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