Just as a corporation has to decide whether to run their Treasury operation as a profit or as a risk reduction centre, so a portfolio manager has to make the same kind of choice. While one can theoretically change one’s core approach to managing the portfolio at any time, it is usually better to make that choice right at the start. In the process, the portfolio manager should decide what style of portfolio management is to be adopted as regards the underlying investments, the desired return profile of the portfolio and also the style of currency management to be used. In the case of a portfolio manager who is focusing on absolute returns, the currency risk management style that is synonymous with this focuses on reducing the risk of the overall portfolio. This in turn usually means adopting a passive style of currency risk management.