From Commodities to Carbon Credits: How Hedge Accounting Supports Stability in Volatile Markets - Video

As market volatility rises, hedge accounting is gaining traction as a valuable tool for businesses to align with their risk management strategies. Matt Marshall, President of AEGIS CTA, and Ernie De Lachica, CPA, Managing Director at BDO USA, discuss the growing adoption of hedge accounting across various industries, noting that while uptake has been slower in the energy sector, hedge accounting is more established in sectors like fixed income, foreign exchange, and commodity manufacturing. They highlight industries with extended lead times, such as automotive and airlines, where hedging strategies have proven beneficial in enhancing financial stability and investor confidence.

Their conversation also explores emerging markets, including environmental and emissions trading, where instruments like California’s LCFS and other ESG-related products are attracting interest, particularly among renewable fuel producers. Matt and Ernie look ahead to the future of hedge accounting, with potential applications expanding into areas like carbon credits and weather derivatives.

Learn more about simplifying your hedge accounting, reporting, and compliance requirements: https://aegis-hedging.com/hedge-accounting