WisdomTree Foreign Exchange Limited
Registered No: 103518
Annual Report and Audited Financial Statements for the
Year ended 31 December 2025
WisdomTree Foreign Exchange Limited
Contents
Management and Administration 1
Directors' Report
2 - 10
Statement of Directors' Responsibilities
11
Independent Auditor's Report 12 - 19
Statement of Profit or Loss and Other Comprehensive Income 20
Statement of Financial Position 21
Statement of Changes in Equity 22
Statement of Cash Flows
23
Notes to the Financial Statements 24 - 43
www.wisdomtree.eu
WisdomTree Foreign Exchange Limited
Management and Administration
Directors
Jersey Legal Advisers
Vinod Rajput
Mourant Ozannes (Jersey) LLP
Olivia Vuillemin (Resigned on 02 July 2025)
22 Grenville Street
Peter Ziemba (Resigned on 07 August 2025)
St Helier
Bryan Governey
Jersey, JE4 8PX
Elizabeth Casely (Appointed on 02 July 2025)
Timothy Jeremiah Darcy (Appointed on 07 August 2025)
Registered Office
IFC 5
St Helier
Jersey, JEI 1ST
Administrator
Apex Financial Services (Alternative Funds) Limited
IFC5
St Helier
Jersey, JEI 1ST
Company Secretary
Apex Financial Services (Secretaries) Limited
IFC5
St Helier
Jersey, JEI 1ST
Manager
WisdomTree Management Jersey Limited
IFC 5
St Helier
Jersey, JEI 1ST
Auditor
Ernst & Young LLP
Liberation House
Castle Street
St Helier
Jersey, JE1 1EY
Registrar
Computershare Investor Services (Jersey) Limited
13 Castle Street
St Helier
Jersey, JE1 1ES
Collateral Custodian
The Bank of New York Mellon
One Canada Square, London E14 5AL
Trustee
The Law Debenture Trust Corporation plc
8th Floor
100 Bishopsgate
London, EC2N 4AG
United Kingdom
Currency Transaction Counterparty
Morgan Stanley & Co. International plc
25 Cabot Square
Canary Wharf
London, E14 4QA
United Kingdom
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WisdomTree Foreign Exchange Limited
Directors’ Report
Directors
Vinod Rajput
Olivia Vuillemin (Resigned on 02 July 2025)
Peter Ziemba (Resigned on 07 August 2025)
Bryan Governey
Elizabeth Casely (Appointed on 02 July 2025)
Timothy Jeremiah Darcy (Appointed on 07 August 2025)
Directors’ Interests
Principal Activities
The Company earns a management fee based upon the contractual value of Currency Securities in issue, expressed as an annual percentage, calculated on a daily basis
and reflected in the net asset value (“NAV”) of the securities on a daily basis, and paid monthly in arrears.
The Company has entered into a service agreement with WisdomTree Management Jersey Limited (“ManJer” or the “Manager”), whereby ManJer is responsible for
supplying or procuring the supply of all management and administration services required by the Company (including marketing) as well as the payment of costs
relating to the listing and issue of Currency Securities.
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The directors of WisdomTree Foreign Exchange Limited (“FXL” or the “Company”) submit herewith the annual report and financial statements of the Company for the
year ended 31 December 2025.
The names and particulars of the directors of the Company during and since the end of the financial year are:
No director has an interest in the Shares of the Company as at the date of this report.
The Company’s principal activity is the issue and listing of collateralised currency securities (“Currency Securities”). Currency Securities are undated secured limited
recourse financial instruments designed to provide investors with long or short exposure to the daily foreign exchange performance of developed or emerging market
currencies or baskets of developed market currencies measured against the US Dollar (“USD”), the Euro (“EUR”) or the British Pound (“GBP”), less applicable fees.
This is achieved by the Currency Securities tracking published currency indices. The price of the Currency Securities is calculated on a daily basis to reflect the change
in the relevant currency index and takes into account the payment of a management fee and a daily spread. The Currency Securities are denominated in USD,EURor
GBP.
Currency Securities are backed by unfunded currency transactions (“Currency Transactions”) with terms corresponding to the terms of Currency Securities. Each time
Currency Securities are issued or redeemed, corresponding Currency Transactions between the Company and the Currency Transaction Counterparty arecreatedor
closed by the Company. Cash received by the Company linked to Currency Transactions entered into with a Currency Transaction Counterparty is used to enter into a
USD, GBP or EUR denominated daily repurchase transaction with the Currency Transaction Counterparty in exchange for eligible collateral on the terms described in
the Company’s Prospectus (collectively the “Underlying Assets”). The Company has entered into a Collateral Administration Master Agreement with the Bank of New
York Mellon as the collateral custodian. On each day the Currency Transaction Counterparty is required to pay back the USD, GBP and EUR amounts in exchange for
the eligible collateral held the previous day, which allows the Company to enter into new daily repurchase transactions in exchange for eligible collateral required on that
day, however in accordance with the terms of a supplemental agreement to the Collateral Administration Master Agreement those new daily repurchase transactions can
be paired with maturing deals on the previous daily repurchase transactions meaning that the net amounts (in each of USD, GBP and EUR) are transferred each day.
This daily process ensures that eligible collateral (at fair market value) received from the Currency Transaction Counterparty represents at least 100% of the value of the
cash paid for the daily repurchase transaction entered into. A daily payment amount will also be calculated in respect of each Currency Transaction on each day to reflect
the movement in the relevant currency index and this amount will also be payable by either the Company or the Currency Transaction Counterparty. No trading or
management of futures contracts is required by the Company.
The Company has entered into a facility agreement with Morgan Stanley & Co. International plc (“Morgan Stanley”), currently the only Currency Transaction
Counterparty, enabling the Company to create and cancel Currency Transactions on an ongoing basis.
Directors’ Report (continued)
Principal Activities (continued)
Review of Operation
USD Currency Securities
14 - 2
-
EUR Currency Securities
- 26 11
6
GBP Currency Securities
12 - -
-
Total Currency Securities
26 26 13
6
As at 31 December 2025, the fair value of assets under management amounted to USD 319.1 million (2024: USD 195.9 million).
The Company has entered into contractual obligations to issue and redeem Currency Securities at prices determined in accordance with formulae set out in the
Prospectus, which are equal to the published net asset value (“NAV”) of each class of Currency Security.
IFRS 13 requires the Company to identify the principal market and to use the price available in that market. The Directors consider the stock exchanges on which the
Currency Securities are listed to be the principal market, based on the greatest volume and level of trading activity and liquidity overall. Accordingly, the fair value of
the Currency Securities is determined using quoted on‑exchange prices reflecting active trading. This represents the price at which the liability would be transferred to a
market participant at the measurement date, as required by IFRS 13, and not the price at which the liability would be extinguished. The Currency Transactions held
to support the Currency Securities are valued using contractual pricing mechanisms defined in the Prospectus. As a result, a temporary valuation mismatch arises
between the value of the Currency Transactions and the fair value of the Currency Securities presented in the Statement of Financial Position, giving rise to
unrealised gains or losses. This difference reverses on the subsequent redemption of the Currency Securities and the transfer of the corresponding Currency
Transactions, as the Securities are redeemed at their contractual value rather than their IFRS 13 fair value.
The resulting gains or losses arising from this valuation mismatch are recognised in profit or loss in accordance with the Company’s accounting policies, with further
details provided in notes 7 and 8 to the financial statements
The Company’s exposure to risks is disclosed in note 12 to the financial statements.
The Company is entitled to a management fee which is calculated on a daily basis:
x
3* and 5* Leveraged Currency Securities have a management fee rate of 0.98% per annum;
x
CNY Currency Securities have a management fee rate of 0.59% per annum; and
x
All remaining classes of Currency Securities have a management fee rate of 0.39% per annum.
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In return for these services, the Company has an obligation to remunerate ManJer with an amount equal to the aggregate of the management fee and the creation and
redemption fees, less any expenses directly incurred (the “ManJer Fee”). ManJer receives creation and redemption fees directly from the holders of Currency Securities
who have entered into an authorised participant agreement with the Company (“Authorised Participants”), and accordingly, there are no related cash flows through the
Company in respect of creation and redemption fees.
The most recent Prospectus was issued on 03 October 2025. As at 31 December 2025 the Company had the following number of classes of Currency Securities inissue
and with listings, in aggregate, admitted to trading on the following exchanges:
London Stock
Exchange
Borsa
Italiana
Deutsche
Börse
NYSE- Euronext Amsterdam
WisdomTree Foreign Exchange Limited
Directors’ Report (continued)
Review of Operations (continued)
2025 2024
USD USD
Management Fees
1,891,108
1,590,272
Bank Interest
6,720
10,440
Total Fee Income
1,897,828
1,600,712
Non-GAAP Performance Measures
Future Developments
Board members are not aware of any developments that might have a significant effect on the operations of the Company in subsequent financial periods not already
disclosed in this report or attached financial statements.
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The Company is also entitled to apply creation and redemption fees on the issue and redemption of Currency Securities. During the year, the Company generated
income from creation and redemption fees, management fees and bank interest as follows:
Under the terms of the service agreement with ManJer, the Company accrued expenses equal to the management fees and the creation and redemptions fees, which, after
taking into account other operating income and expenses, resulted in a result before fair value movements for the year of USD Nil (2024: USD Nil).
As the difference in the valuation of Currency Transactions (held to support the Currency Securities) and Currency Securities would be reversed instead of being
realised where the redemption of securities are at the contractual value and not at their IFRS 13 fair value. As the difference in the valuation of Currency Transaction
and Currency Securities would be reversed on a subsequent redemption of the Currency Securities and transfer of the corresponding Currency Transaction (as described
further in note 8 to the financial statements), the Company presents an adjusted Statement of Profit or Loss and Other Comprehensive Income and an adjusted Statement
of Changes in Equity in note 15 to the financial statements.
WisdomTree Foreign Exchange Limited
Directors’ Report (continued)
Going Concern
Corporate Social Responsibility
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Environmental, Social and Governance (“ESG”) investing is guided at the WisdomTree group level by an ESG Steering Committee, which includes senior leaders from
across the WisdomTree group business, and which includes several sub-committees focused on particular ESG considerations, such as improving data and transparency
into the ESG attributes of WisdomTree’s products. Particular ESG considerations relevant to the Company’s products are overseen by the directors, leveraging the work
undertaken by the ESG Steering Committee. More information on WisdomTree’s corporate social responsibility strategy can be found on the WisdomTree website
(https://www.wisdomtree.eu/en-gb/wisdomtree-corporate-responsibility).
The Board acknowledges that climate change and its impact on the global economy is of increasing interest and focus for stakeholders and that, where relevant,
stakeholders will seek information from companies regarding how climate change is expected to impact the operations of the business and how climate change risk has
been considered in the context of reported results.
In acknowledging the above, the Board has considered the Company’s exposure to climate change and determined that due to the nature of the Company and its
operations there are no directly observed impacts of climate change on the business. As a result, the Board concluded that there is no basis on which to provide
extended information of analysis relating to climate change, including as part of the basis of accounting or individual accounting policies adopted by the Company.
In the above determination, the Board has concluded specifically that climate change, including physical and transition risks, does not have a material impact on the
recognition and separate measurement considerations of the assets and liabilities in these financial statements as at 31 December 2025.
This conclusion is based on the fact that assets are reported at fair value under IFRS, and as set out in note 12 to the financial statements are categorised as Level 2 of
the fair value hierarchy due to the use of observable, verifiable inputs and third party information sources. The liabilities are valued utilising listed market prices at the
period end. These observable inputs and market prices will reflect wider market sentiment, which inherently includes market perspectives relating to the impact of
climate change.
The Board recognises that government and societal responses to climate change risks are still developing and the future impact cannot be predicted. Future valuations of
assets and liabilities may therefore differ as the market responds to these changing impacts or assesses the impact of current requirements differently.
The nature of the Company’s business dictates that the outstanding Currency Securities may be redeemed at any time by Authorised Participants and in certain
circumstances by individual holders and also, in certain circumstances, may be compulsorily redeemed by the Company. As the redemption of Currency Securities will
always coincide with the closing of an equal amount of Currency Transactions, liquidity risk is mitigated through this process which is considered to minimize exposure
to liquidity risk. All other expenses of the Company are met by ManJer. The directors closely monitor the financial position and performance of ManJer, its assets under
management, and therefore its related revenue streams, in respect of fulfilling the obligations under the services agreement.
As Currency Transactions are held to support Currency Securities, any deficit or surplus reported on unrealised positions would be reversed on a subsequent redemption
of the Currency Securities and the related transfer of Currency Transactions. A reported deficit is not considered indicative of any issues relating to solvency of the
Company and the directors are satisfied that any obligations arising in respect of the Currency Securities can be managed in accordance with the terms of the applicable
Prospectus. The directors continue to monitor the price changes impacting Currency Transactions. Market volatility increased at the beginning of 2026 due to the impact
of geopolitical developments, including the recent significant escalation of conflict in the Middle East since February 2026, which has heightened regional instability
and continues to create rapidly evolving geopolitical and economic conditions. These developments may influence market sentiment and global economic activity, and
the directors remain alert to any potential implications for the Company’s operations and Currency Transactions and, will take any potential actions needed or as
required under the terms of the prospectus, as facts and circumstances are subject to change and may be specific to investments and jurisdictions. The directors consider
the operations of the Company to be ongoing, with a reasonable expectation that the Company has adequate resources to continue in operational existence until 30 April
2027(being the period of assessment), and accordingly these financial statements have been prepared on the going concern basis.
Sustainability and corporate responsibility are embedded throughout the business of the WisdomTree, Inc and its subsidiaries (the “WisdomTree group”) as Wisdomtree
Group believes this benefits shareholders and employees of the WisdomTree group, investors in WisdomTree’s products as well as wider society.
WisdomTree Foreign Exchange Limited
Directors’ Report (continued)
Dividends
Directors’ Remuneration
Employees
Auditor
Principal Risks and Uncertainties
The Currency Securities provides investors with long or short exposure to the daily foreign exchange performance of developed and emerging market currencies
measured against USD, EUR or GBP. Movements in the value of the Underlying Assets, and thus the value of the Currency Securities, may vary widely which could
have an impact on the demand for the Currency Securities issued by the Company.
Any movements in the value of the Currency Transactions are wholly attributable to the holders of the Currency Securities, therefore the Company has no residual
exposure to movements in the value of the Currency Transactions. From a commercial perspective the Company does not retain any net gains or losses or netrisk
exposures, as (with the exception of the impact of the Management Fee) the gains or losses on the liability represented by the Currency Securities are matched
economically by corresponding losses or gains attributable to the Currency Transactions (see detail on page 3 regarding the accounting mis-match). Furthermore, the
Company is obligated to remunerate ManJer with the ManJer Fee, which results in the Company recognising a result before fair value movements of nil for each year.
As a result, the principal risks and uncertainties to which the Company is exposed has not materially changed during the year ended 31 December 2025.
There is an inherent risk from the point of view of investors as the values of currencies, and thus the value of the Currency Securities, may vary widely due to, amongst
other things, changing supply and demand for a particular currency, government and monetary policy or intervention, interest rate levels and global or regional political,
economic or financial events. The market price of Currency Securities is (and will remain) a function of supply and demand amongst investors wishing to buy and sell
Currency Securities and the bid or offer spread that the market makers are willing to quote.
Movements in exchange rates can be so significant that they lead to the level of a currency index for any class falling to zero. Since leveraged currency indices provide
leveraged exposure to daily changes in foreign exchange rates calculated against a base value determined on the second previous business day, it is possible that in
certain highly volatile markets a leveraged currency index may fall to zero where the foreign exchange rate moves by a large amount over the course of two trading days
or even where a particular exchange rate moves by a very large amount over the course of one day. In these circumstances the Currency Securities for that class may
become subject to compulsory redemption at a zero price. In such situations, the Currency Securities may be redeemed for no value and a security holder will receive no
payment on that redemption.
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There were no dividends declared or paid in the year (2024: USD Nil). It is the Company’s policy that dividends will only be declared when the directors are of the
opinion that there are sufficient distributable reserves.
No director has a service contract with the Company. The directors of the Company who are employees within the WisdomTree, Inc. group do not receive separate
remuneration in their capacity as directors of the Company. The directors of the Company who are employees of Apex Financial Services (Alternative Funds) Limited
(“Apex” or the “Administrator”) and R&H Fund Services (Jersey) Limited do not receive separate remuneration in their capacity as directors of the Company; however
Apex receives a fee from ManJer which includes services in respect of the Company, including for the provision of directors who are employees of Apex.
The Company does not have any employees (2024: none). It is the Company’s policy to use the services of specialist subcontractors or consultants as far as possible.
The Independent Auditor is Ernst & Young LLP. A resolution to re-appoint Ernst & Young LLP will be proposed at the next Board meeting of the directors on behalf of
the sole shareholder.
WisdomTree Foreign Exchange Limited
Directors’ Report (continued)
Movement
Securities NAV USD Securities NAV USD
in NAV
WisdomTree 3x Long EUR Short GBP
13,427 30.06 403,632 25,427 24.95 634,348
20.50%
WisdomTree 3x Long USD Short GBP
28,054 76.92 2,158,007 22,694 88.48 2,008,026
-13.06%
WisdomTree 3x Short EUR Long GBP
7,171 51.02 365,895 37,721 52.26 1,971,388
-2.37%
WisdomTree 3x Short USD Long GBP
174,961 13.05 2,283,984 164,011 9.98 1,637,365
30.76%
WisdomTree Long CHF Short GBP
33,069 79.33 2,623,359 10,929 70.47 770,145
12.58%
WisdomTree Long EUR Short GBP
8,882 59.83 531,388 7,032 52.41 368,572
14.15%
WisdomTree Long JPY Short GBP
108,769 33.32 3,624,598 138,419 33.65 4,658,265
-0.98%
WisdomTree Long USD Short GBP
22,492 75.20 1,691,361 19,352 73.16 1,415,867
2.78%
WisdomTree Short CHF Long GBP
2,272 45.37 103,083 1,882 42.13 79,288
7.69%
WisdomTree Short EUR Long GBP
64,369 64.95 4,181,035 70,889 61.04 4,326,808
6.42%
WisdomTree Short JPY Long GBP
1,779 102.53 182,406 1,569 83.93 131,691
22.16%
WisdomTree Short USD Long GBP
19,880 49.50 984,144 16,860 42.04 708,788
17.76%
WisdomTree 3x Long EUR Short USD
186,078 11.88 2,210,557 63,578 8.63 548,409
37.72%
WisdomTree 3x Long GBP Short USD
128,888 16.15 2,081,966 79,988 12.97 1,037,300
24.56%
WisdomTree 3x Long JPY Short USD
1,974,133 2.00 3,948,176 1,613,233 2.24 3,612,039
-10.68%
WisdomTree 3x Short EUR Long USD
12,978 74.02 960,662 14,768 103.02 1,521,457
-28.15%
WisdomTree 3x Short GBP Long USD
20,511 43.64 895,037 8,301 54.54 452,709
-19.99%
WisdomTree 3x Short JPY Long USD
1,848 338.92 626,329 1,386 311.31 431,480
8.87%
WisdomTree Long EUR Short USD
17,933 35.04 628,457 3,503 30.54 106,977
14.76%
WisdomTree Long GBP Short USD
68,319 41.09 2,807,374 65,299 37.05 2,419,340
10.91%
WisdomTree Long JPY Short USD
173,955 23.25 4,043,898 159,205 23.35 3,717,709
-0.45%
Balance c/f
37,335,348 32,557,971
Principal Risks and Uncertainties (continued)
The contractual value (at NAV) of the Currency Securities at year end, and the movement over the year amounted to:
31 December 2025 31 December 2024
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WisdomTree Foreign Exchange Limited
Directors’ Report (continued)
Movement
Securities NAV USD Securities NAV USD
in NAV
Balance b/f
37,335,348 32,557,971
WisdomTree Short EUR Long USD
10,622 71.69 761,442 9,330 77.57 723,708
(7.58%)
WisdomTree Short GBP Long USD
28,460 59.81 1,702,151 18,780 62.49 1,173,614
(4.30%)
WisdomTree Short JPY Long USD
3,015 105.02 316,639 3,015 98.77 297,795
6.33%
WisdomTree 3x Long CHF Short EUR
9,196 69.16 635,976 6,341 63.99 405,764
8.08%
WisdomTree 3x Long GBP Short EUR
6,976 49.76 347,160 9,976 48.94 488,179
1.70%
WisdomTree 3x Long JPY Short EUR
1,008,165 5.18 5,217,635 991,934 7.11 7,051,084
(27.19%)
WisdomTree 3x Long USD Short EUR
39,816 95.25 3,792,652 30,901 117.44 3,629,147
(18.89%)
WisdomTree 3x Short CHF Long EUR
88,654 12.92 1,145,718 100,954 11.07 1,117,538
16.75%
WisdomTree 3x Short GBP Long EUR
5,969 20.38 121,644 17,749 16.42 291,355
24.15%
WisdomTree 3x Short JPY Long EUR
4,297 109.29 469,639 13,877 64.89 900,529
68.42%
WisdomTree 3x Short USD Long EUR
8,681,682 9.17 79,602,735 8,631,782 6.13 52,894,647
49.63%
WisdomTree Long AUD Short EUR
20,561 57.50 1,182,253 11,561 52.11 602,436
10.34%
WisdomTree Long CHF Short EUR
21,651 71.96 1,557,914 27,951 63.85 1,784,744
12.69%
WisdomTree Long GBP Short EUR
76,560 61.19 4,684,847 93,861 55.41 5,200,712
10.44%
WisdomTree Long JPY Short EUR
501,094 31.02 15,545,194 394,714 31.30 12,354,067
(0.88%)
WisdomTree Long NOK Short EUR
90,293 42.76 3,860,916 118,693 36.96 4,387,168
15.68%
WisdomTree Long SEK Short EUR
96,948 48.61 4,712,506 121,888 40.36 4,919,175
20.44%
WisdomTree Long USD Short EUR
58,461 65.30 3,817,520 63,041 63.47 4,001,077
2.89%
WisdomTree Short AUD Long EUR
895 41.03 36,721 895 34.88 31,220
17.62%
WisdomTree Short CHF Long EUR
9,759 33.53 327,184 9,009 29.00 261,221
15.63%
WisdomTree Short GBP Long EUR
8,674 40.01 347,045 16,194 33.90 548,964
18.03%
Balance c/f
167,520,839 135,622,115
Principal Risks and Uncertainties (continued)
The contractual value (at NAV) of the Currency Securities at year end, and the movement over the year amounted to (continued):
31 December 2025
31 December 2024
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WisdomTree Foreign Exchange Limited
Directors’ Report (continued)
Movement
Securities NAV USD Securities NAV USD
in NAV
Balance b/f
167,520,839 135,622,115
WisdomTree Short JPY Long EUR
6,434 72.98 469,538 1,134 55.68 63,140
31.07%
WisdomTree Short NOK Long EUR
2,133 55.23 117,812 733 49.27 36,112
12.11%
WisdomTree Short SEK Long EUR
2,333 51.35 119,804 843 47.53 40,067
8.04%
WisdomTree Short USD Long EUR
3,261,880 37.15 121,171,255 1,518,906 29.45 44,730,660
26.14%
WisdomTree 5x Long GBP Short EUR
7,366 27.34 201,356 5,866 29.18 171,159
(6.31%)
WisdomTree 5x Long USD Short EUR
44,524 91.86 4,090,006 16,554 146.42 2,423,860
(37.26%)
WisdomTree 5x Short GBP Long EUR
38,192 16.85 643,569 13,292 12.89 171,370
30.70%
WisdomTree 5x Short USD Long EUR
4,646,836 4.25 19,754,972 4,201,236 2.43 10,221,619
74.73%
WisdomTree Long CNY Short USD
5,786 54.46 315,112 5,786 52.40 303,173
3.94%
WisdomTree Short CNY Long USD
14,691 39.05 573,651 14,691 38.69 568,339
0.94%
Total
314,977,914 194,351,614
The cash flows of the Company relate to:
• the receipt and payment of amounts on the creation and redemption of Currency Securities;
As a result, those cash flows are impacted by both the movements in the levels of the underlying currency indices (the daily payment amount)
as well as the demand amongst investors wishing to buy and sell Currency Securities (resulting in creation and redemption activity), which
itself may be also be driven by movements in the underlying currency indices.
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Each Currency Security is a debt instrument whose redemption price is linked to the performance of the underlying currency index. Each
class of Currency Security is issued under limited recourse arrangements whereby the holders have recourse only to the relevant Underlying
Assets held to support the Currency Securities and not to the Underlying Assets of any other class of Currency Security or the Company.
• the receipt and payment of the Daily Payment Amounts transferred between the Company and the Currency Transaction Counterparty; and
• the receipt and payment of the net movements on the daily repurchase transactions (arising from creation and redemption activity, the
impact of Interest charges and the Management Fees as well as the reinvestment of the daily payment amount).
Principal Risks and Uncertainties (continued)
The contractual value (at NAV) of the Currency Securities at year end, and the movement over the year amounted to (continued):
31 December 2025
31 December 2024
Whilst the table above reflects the NAV at 31 December 2025 and 31 December 2024, together with the movement, this does not reflect the
recommended holding period for Currency Securities, which in some cases is one day. Further information on daily percentage change of the
contractual value (at NAV) of the Currency Securities can be found on the WisdomTree website (https://www.wisdomtree.eu/en-
gb/products).
Additional information on other financial and operational risks and uncertainties faced by the Company, including further details surrounding
the value of Currency Securities and the Currency Transactions are disclosed in note 12 to the financial statements.
WisdomTree Foreign Exchange Limited
Directors’ Report (continued)
Corporate Governance
Internal Control
Audit Committee
Vinod Rajput
Director
Jersey
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The Company is dependent upon ManJer to provide management and administration services to it. ManJer is licensed under the Financial Services (Jersey) Law 1998 to
conduct classes U and Z of Fund Services Business. ManJer outsources the administration services in respect of the Company to the Administrator. Documented
contractual arrangements are in place with the Administrator which define the areas where the authority is delegated to them. The performance of the Manager and
Administrator are reviewed on an ongoing basis by the Board through their review of periodic reports.
ManJer provides management and other services to both the Company and other related party companies issuing exchange-traded products.
The Board, having reviewed the effectiveness of the internal control systems of the Manager and the Administrator, does not consider that there is a need for the
Company to establish its own internal audit function.
The Board has not established a separate audit committee; instead the Board meets to consider the financial reporting by the Company, the internal controls, and
relations with the external auditor. In addition, the Board reviews the independence and objectivity of the auditor.
24 April 2026
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There is no standard code of corporate governance in Jersey. The operations, as previously described in the Directors’ Report, are such that the directors have
determined that the Company is not required to apply, and has elected not to voluntarily apply, the UK Corporate Governance Code.
As the Board is small there is no nomination committee and appointments of new directors are considered by the Board as a whole. The Board does not consider it
appropriate that directors should be appointed for a specific term. Furthermore, the corporate governance framework implemented and constitution of the Board is such
that it is considered unnecessary to identify a senior non-executive director.
The constitution of the Board is disclosed on page 1. The Board meets regularly as required by the operations of the Company, but at least quarterly to review the overall
business of the Company and to consider matters specifically reserved for its review.
During the year the Company did not have any employees or subsidiaries, and there is no intention that this will change. The Company, being a special purpose
company established for the purpose of issuing Currency Securities, has not undertaken any business, save for issuing and redeeming Currency Securities, entering into
the required documents, performing the obligations and exercising its rights in relation thereto, since its incorporation. The Company does not intend to undertake any
business other than issuing and redeeming Currency Securities and performing the obligations and exercising its rights in relation thereto.
WisdomTree Foreign Exchange Limited
Statement of Directors' Responsibilities
•
•
•
•
•
•
•
By order of the Board
Vinod Rajput
Director
Jersey
- 11 -
www.wisdomtree.eu
With regard to Directive 2004/109/EC, amended by Directive 2013/50/EU (collectively the Transparency Directive), the Central Bank (Investment Market Conduct)
Rules of the Central Bank of Ireland and the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority, the directors confirm that to the best of
their knowledge that:
the financial statements for the year ended 31 December 2025 give a true and fair view of the assets, liabilities, financial position and profit or loss of the
Company as required by law and in accordance with IFRS as issued by the IASB; and
the Directors’ Report gives a fair view of the development and performance of the Company’s business, including financial position and the important events
that have occurred during the year, and their impact on these financial statements, together with a description of the principal risks and uncertainties they
face.
24 April 2026
www.wisdomtree.eu
make judgements and estimates that are reasonable and prudent;
state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;
assess the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
use the going concern basis of accounting unless they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable
accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies (Jersey) Law 1991. They
are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Company and to prevent and
detect fraud and other irregularities.
The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in Jersey
governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
The directors are responsible for preparing the financial statements in accordance with applicable law and regulations.
Company Law requires the directors to prepare financial statements for each financial year. Under that law they have elected to prepare the financial statements in
accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and applicable law.
Under Company Law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for that period. In preparing these financial statements, the directors are required to:
select suitable accounting policies and then apply them consistently;
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED
12
Opinion
We have audited the financial statements of WisdomTree Foreign Exchange Limited (the “company”)
for the year ended 31 December 2025 which comprise the Statement of Profit or Loss and Other
Comprehensive Income, the Statement of Financial Position, the Statement of Changes in Equity, the
Statement of Cash Flows and the related notes 1 to 15, including material accounting policy information.
The financial reporting framework that has been applied in their preparation is applicable law and
International Financial Reporting Standards as issued by the International Accounting Standards Board
(“IFRS”).
In our opinion, the financial statements:
► give a true and fair view of the state of the company’s affairs as at 31 December 2025 and of its
profit for the year then ended;
► have been properly prepared in accordance with IFRS;
► have been properly prepared in accordance with the requirements of the Companies (Jersey) Law
1991.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our report. We are independent of the
company in accordance with the ethical requirements that are relevant to our audit of the financial
statements, including the UK FRC’s Ethical Standard as applied to listed entities, and we have fulfilled
our other ethical responsibilities in accordance with these requirements .
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors ’ use of the going concern
basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the
directors’ assessment of the company’s ability to continue to adopt the going concern basis of
accounting included:
► We obtained an understanding of management’s rationale for using the going concern basis of
accounting and confirmed our understanding of management’s Going Concern assessment
process including the process they adopted to capture all key factors in their assessment ;
► We obtained management’s board approved going concern assessment covering the period of
assessment from the date of signing to 30 April 2027. Management’s assessment has focused
on a combination of;
o Assessing the ongoing viability of the company through continued involvement of its
Currency Transaction Counterparty and Authorised Participants;
o Assessing the ongoing ability of WisdomTree Management Jersey Limited (“ManJer”)
to continue to meet its obligations as manager and pay all expenses of the company.
This includes consideration of the assets under management of all managed issuer
entities (“Issuer Platform”) which includes this company. In assessing this ability
management considered the fixed and variable operating costs that could be supported
under varying levels of total assets under management for the Issuer Platform.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED (continued)
13
► Using our understanding of the business, we evaluated whether the considerations and method
adopted by management in assessing going concern was appropriate.
► We performed reverse stress testing on the forecasts to understand how severe the downside
scenarios would have to be, and the reduction in platform assets under management, to result
in the platform generating insufficient management fees to cover operating costs. We observed
significant headroom in management fee income, at current Assets Under Management
(“AUM”) levels, in excess of fixed and AUM based costs which supports management’s
assumption that the Issuer Platform is able to absorb heightened levels of volatility in AUM.
► We considered whether management’s disclosures, in the Annual Report and financial
statements, sufficiently and appropriately discloses information required in respect of the going
concern assumption applied through consideration of relevant disclosure standards.
Based on the work we have performed, we have not identified any material uncertainties relating to
events or conditions that, individually or collectively, may cast significant doubt on the company’s ability
to continue as a going concern for a period to 30 April 2027.
Our responsibilities and the responsibilities of the directors with respect to going concern are described
in the relevant sections of this report. However, because not all future events or conditions can be
predicted, this statement is not a guarantee as to the company’s ability to continue as a going concern.
Overview of our audit approach
Key audit
matters
►
Valuation of Financial Assets at fair value through profit and loss – Currency
Transactions
►
Valuation of Financial Liabilities at fair value through profit and loss – Currency
Securities
Materiality
► Overall materiality of US$3.18m which represents 1% of total assets.
An overview of the scope of our audit
Tailoring the scope
Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality
determine our audit scope for the company. This enables us to form an opinion on the financial
statements. We take into account size, risk profile, the organisation of the company and effectiveness
of controls, changes in the business environment and the potential impact of climate change when
assessing the level of work to be performed. All audit work was performed directly by the audit
engagement team.
Changes from the prior year
There were no scoping changes compared to the prior year.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED (continued)
14
Climate change
There has been increasing interest from stakeholders as to how climate change will impact companies.
The company has determined that there are no directly observed impacts of climate change on the
business due to the nature of the company and its operations. This is explained on page 5 in the
corporate social responsibility section, which form part of the “Other information,” rather than the audited
financial statements. Our procedures on these disclosures therefore consisted solely of considering
whether they are materially inconsistent with the financial statements or our knowledge obtained in the
course of the audit or otherwise appear to be materially misstated.
Our audit effort in considering climate change was focused on evaluating management’s assessment of
the impact of climate risk, physical and transition, the adequacy of the company’s disclosures in the
financial statements as set out in note 2 and conclusion that there was no further impact of climate
change to be taken into account as the material assets and liabilities are valued based on market pricing
as required by IFRS.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the f inancial statements of the current period and include the most significant assessed risks
of material misstatement (whether or not due to fraud) that we identified. These matters included those
which had the greatest effect on the overall audit strategy, the allocation of resources in the audit; and
directing the efforts of the engagement team. These matters were addressed in the context of our audit
of the f inancial statements as a whole, and in our opinion thereon, and we do not provide a separate
opinion on these matters.
Risk
Our response to the risk
Key observations
communicated to the Board
Valuation of Financial Assets
at fair value through profit and
loss – Currency Transactions
2025: USD 314,977,914
(2024: USD 194,351,614)
Refer to the Accounting policies
(page 27); and Note 7 of the
Financial Statements (pages 31-32)
Risk that investment values are
misstated or that valuations are
incorrectly calculated, including
as a result of management
override of internal controls.
The Currency Transactions held
comprise a range of currency
derivatives that are used by the
company to provide holders of
issued securities with exposure
that is designed to track
currency movements.
The Currency Transactions are
carried at fair value as a
Financial Asset.
Our response to the risk
comprised:
We walked through the
company’s systems, controls
and process implemented in
respect of the valuation of
Currency Transactions
.
We
assessed
the design of the
company’s systems and controls
implemented in respect of
Currency Transactions
valuation.
In executing our strategy, we
adopted a fully substantive
approach.
We obtained independent
confirmation, from the currency
transactions
counterparty, of the
contractual value of contracts as
at the reporting date.
We agreed
the valuation
methodology applied to the
definition set out in the
prospectus and validation of key
There were no matters identified
during our audit work on
valuation of
Currency
Transactions
that we
brought to
the attention of the Board of
Directors of the
company.
Based on our testing we are
satisfied that the valuation of the
Currency Transactions
is not
materially misstated
.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED (continued)
15
Risk
Our response to the risk
Key observations
communicated to the Board
The risk comprises the risk of
errors in both the valuation
methodology applied (including
the risk that the valuation
methodology has not been
determined in accordance with
the terms of the applicable
prospectus) and in the source
and timing of valuation inputs
utilised.
The balance of Currency
Transactions represents 99% of
the company’s total assets as at
31 December
2025 (2024: 99%)
and therefore any error in
valuation approach could be
significant.
The risk has remained
consistent with that observed in
the prior year.
inputs used to derive the value
of the Currency Transactions.
This included agreement on a
sample basis of the price of the
referenced currency indices to
external pricing sources as at 31
December
2025 against
relevant IFRS requirements.
We r
ecalculated the value of a
sample of
Currency
Transactions held at 31
December 2025, representing
100% of the total value of
Currency Transactions held.
Specifically,
in addressing the
risks of management override of
controls, we assessed the
Currency Transactions
valuation
for evidence of management
bias, considered whether any
significant unusual transactions
arose based on our
understanding of the Company
and its activities and tested the
appropriateness of journal
entries recorded in the general
ledger and other adjustments
made in the preparation of the
financial statements.
Valuation of Financial
Liabilities at fair value through
profit or loss – Currency
Securities
2025: USD 316,130,549
(2024: USD 195,785,517)
Refer to the Accounting policies
(pages 27-28); and Note 8 of the
Financial Statements (pages 32-34
)
Risk that values of securities in
issue are misstated or that
valuations are incorrectly
captured.
The Currency Securities in issue
comprise a range of financial
instruments that provide holders
of issued securities with
exposure to movements in
prices of foreign currency.
The Currency Securities are
carried at fair value as a
Financial Liability.
Our response to the risk
comprised:
We walked through the
company
’s systems,
controls
and process
implemented in
respect of the valuation
of
Currency Securities
.
We
assessed the
design of the
company’s systems and controls
implemented in respect of
Currency Securities
valuation.
In executing our strategy, we
adopted a fully substantive
approach.
We a
ssessed the
appropriateness of the valuation
methodology applied,
comprising the use of traded
security prices to value the
Currency Securities, against
relevant IFRS requirements.
There were no matters identified
during our audit work on
valuation of Currency Securities
that we
brought
to the attention
of the Board of Directors of the
company
.
Based on our testing we are
satisfied that the valuation of
Currency Securities
is not
materially misstated
.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED (continued)
16
Risk
Our response to the risk
Key observations
communicated to the Board
The risk comprises the risk of
errors in both the valuation
methodology applied and, in the
source, and timing of valuation
inputs utilised.
The balance of Currency
Securities represents 99% of the
company’s total liabilities as at
31 December
2025 (2024: 99%)
and therefore any error in
valuation approach could be
significant.
The risk has remained
consistent with that observed in
the prior year.
We independently obtained
security prices using external
pricing sources at the balance
sheet date.
We recalculated the value of
Currency Securities
held at
31
December 2025, by
multiplying the security price by
the confirmed security balance
in issue. This represented 100%
of the total value of Currency
Securities
in issue.
Our application of materiality
We apply the concept of materiality in planning and performing the audit, in evaluating the effect of
identified misstatements on the audit and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably
be expected to influence the economic decisions of the users of the financial statements. Materiality
provides a basis for determining the nature and extent of our audit procedures.
We determined materiality for the company to be US$3.18 million (2024: US$1.95 million), which is 1%
(2024: 1%) of Total Assets. We believe that Total Assets provides us with an appropriate basis for audit
materiality as Total Assets reflects the relevant exposure of holders of issued securities to the underlying
asset base.
There has been no change in the basis of materiality used compared to the prior year.
Performance materiality
The application of materiality at the individual account or balance level. It is set at an amount to reduce
to an appropriately low level the probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality.
On the basis of our risk assessments, together with our assessment of the company’s overall control
environment, our judgement was that performance materiality was 50% (2024: 50%) of our planning
materiality, namely US$1.59m (2024: US$0.98m). We have set performance materiality in both periods
at this percentage in response to the value of errors identified and corrected in the f inancial statement
close process.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED (continued)
17
Reporting threshold
An amount below which identified misstatements are considered as being clearly trivial.
We agreed with the Board that we would report to them all uncorrected audit differences in excess of
US$0.16m (2024: US$0.1m), which is set at 5% of materiality, as well as differences below that threshold
that, in our view, warranted reporting on qualitative grounds.
We evaluate any uncorrected misstatements against both the quantitative measures of materiality
discussed above and in light of other relevant qualitative considerations in forming our opinion.
Other information
The other information comprises the information included in the annual report set out on pages 1 to
11 other than the financial statements and our auditor’s report thereon. The directors are responsible
for the other information contained within the annual report.
Our opinion on the financial statements does not cover the other information and, except to the extent
otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other inf ormation and, in doing so, consider whether the other
information is materially inconsistent with the f inancial statements or our knowledge obtained in the
course of the audit or otherwise appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to determine whether this gives
rise to a material misstatement in the f inancial statements themselves. If, based on the work we have
performed, we conclude that there is a material misstatement of the other information, we are required
to report that fact.
We have nothing to report in this regard.
Matters on which we are required to report by exception
We have nothing to report in respect of the f ollowing matters in relation to which the Companies (Jersey)
Law 1991 requires us to report to you if , in our opinion:
► proper accounting records have not been kept by the company, or proper returns adequate for our
audit have not been received f rom branches not visited by us; or
► the f inancial statements are not in agreement with the company’s accounting records and returns;
or
► we have not received all the inf ormation and explanations we require for our audit
Responsibilities of directors
As explained more fully in the Statement of Directors’ Responsibilities set out on page 10, the directors
are responsible f or the preparation of the f inancial statements and f or being satisfied that they give a
true and f air view,
and f or such internal control as the directors determine is necessary to enable the
preparation of f inancial statements that are f ree f rom material misstatement, whether due to f raud or
error.
In preparing the financial statements, the directors are responsible for assessing the company’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless the directors either intend to liquidate the company or to
cease operations, or have no realistic alternative but to do so.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED (continued)
18
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor ’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
Explanation as to what extent the audit was considered capable of detecting irregularities,
including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The
risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one
resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
misrepresentations, or through collusion. The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below.
However, the primary responsibility for the prevention and detection of fraud rests with both those
charged with governance of the company and management.
► We obtained an understanding of the legal and regulatory frameworks that are applicable to the
company and determined that the most significant are those that relate to the reporting
framework, comprising IFRS and the Companies (Jersey) Law 1991. In addition, we concluded
that there are certain significant laws and regulations that may have an effect on the
presentation and disclosure of the financial statements being the applicable Listing Rules of the
Central Bank of Ireland (Investment Market Conduct) and UK Listing Authority Rules;
► We understood how WisdomTree Foreign Exchange Limited is complying with those
frameworks by making enquiries of the directors and key management of the administrative
service provider. We corroborated our enquiries through our review of minutes of Board
meetings, papers provided to the board and correspondence received from regulatory bodies
and noted no contradictory evidence;
► We assessed the susceptibility of the company’s financial statements to material misstatement,
including how fraud might occur by understanding the investment objectives of the Company
and discussing with management to understand where reporting was considered susceptible to
fraud. Where this risk was considered to be higher, we performed audit procedures in response
to the identified fraud risk. These procedures included testing of transactions to supporting
documentation, testing of specific accounting journal entries, and focused testing, including that
referred to in the key audit matters section above. These procedures were designed to provide
reasonable assurance that the financial statements were free from fraud or error;
► Based on this understanding we designed our audit procedures to identify non-compliance with
such laws and regulations. Our procedures involved reading board minutes to identify any non-
compliance with laws and regulations, a review of any associated reporting submitted to the
board on compliance with laws and regulations and enquiries of members of management of
the appointed administrative service provider;
As the Company operates in the asset management industry the Audit Partner assessed the experience
of the engagement team and concluded that the team had the appropriate competence and capabilities.
A f urther description of our responsibilities for the audit of the f inancial statements is located on the
Financial Reporting Council’s website at https://www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WISDOMTREE FOREIGN EXCHANGE LIMITED (continued)
19
Other matters we are required to address
► Following the recommendation from those charged with governance, we were appointed by the
company on 3 December 2019 to audit the financial statements for the year ending 31 December
2019 and subsequent financial periods.
The period of total uninterrupted engagement including previous renewals and reappointments is
7 years, covering the years ending 31 December 2019 to 31 December 2025.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the
company and we remain independent of the company in conducting the audit. The audit opinion
is consistent with the additional report to those charged with governance.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Article 113A of the
Companies (Jersey) Law 1991. Our audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them in an auditor’s report and for no
other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company’s members as a body, for our audit work, for this
report, or for the opinions we have formed.
Ove Toennes Svejstrup
for and on behalf of Ernst & Young LLP
Jersey, Channel Islands
Date: 24 April 2026
WisdomTree Foreign Exchange Limited
Statement of Profit or Loss and Other Comprehensive Income
For year ended 31 December 2025
2025
2024
Notes USD USD
Income
3 1,897,828
1,600,712
Expenses
3 (1,897,828)
(1,600,712)
Result Before Fair Value Movements
3
- -
Change in Contractual and Fair Value of Currency Transactions
7 52,653,742
(36,297,242)
Change in Fair Value of Currency Securities
8 (52,372,474)
34,324,128
Profit/(Loss) for the Year
1, 2
281,268 (1,973,114)
The directors consider the Company’s activities as continuing.
1
A non-statutory and non-GAAP Statement of Profit or Loss and Other Comprehensive Income reflecting adjustments representing the movement in the difference between the value of
the Currency Transactions and the price of Currency Securities is set out in note 15 to the financial statements.
2
There are no items of Other Comprehensive Income, therefore the Profit / (Loss) for the Year also represents the Total Comprehensive Income/(Expense) for the Year.
The notes on pages 24 to 43 form part of these financial statements
- 20 -
www.wisdomtree.eu
Year ended
31 December
Year ended
31 December
WisdomTree Foreign Exchange Limited
Statement of Financial Position
As at 31 December 2025
2025
2024
Notes USD USD
5 185,717
129,311
5 329,481
732,029
7-
620,649
7 314,977,914
194,351,614
8 2,765,455
68,092
6 1,784
1,784
Total Assets
318,260,351
195,903,479
Liabilities
Currency Securities
8 316,130,549
195,785,517
8 329,481
1,352,678
7 2,765,455
68,092
Trade and Other Payables
9 185,717
129,311
Total Liabilities
319,411,202
197,335,598
Equity
Stated Capital
10 3
3
Retained Earnings
1,781
1,781
Revaluation Reserve
15 (1,152,635)
(1,433,903)
Total Equity
(1,150,851)
(1,432,119)
Total Equity and Liabilities
318,260,351
195,903,479
Vinod Rajput
Director
www.wisdomtree.eu
The notes on pages 24 to 43 form part of these financial statements
- 21 -
www.wisdomtree.eu
Assets
Cash and Cash Equivalents
Cash held for Currency Securities due for Settlement
Amounts Receivable on Currency Transactions Awaiting Settlement
Currency Transactions
Amounts Receivable on Currency Securities Awaiting Settlement
Trade and Other Receivables
Amounts Payable on Currency Securities Awaiting Settlement
Amounts Payable on Currency Transactions Awaiting Settlement
The assets and liabilities in the above Statement of Financial Position are presented in order of liquidity from most to least liquid.
The financial statements on pages 20 to 43 were approved and authorised for issue by the Board of Directors and signed on its behalf on 24 April 2026.
As at
31 December
As at
31 December
WisdomTree Foreign Exchange Limited
Statement of Changes in Equity
For year ended 31 December 2025
Stated
Retained Revaluation
Total
Capital Earnings Reserve
Equity
Notes USD USD USD
USD
3 1,781 539,211
540,995
(1,973,114)
(1,973,114)
15 - 1,973,114 (1,973,114)
-
3
3 1,781 (1,433,903)
(1,432,119)
3 1,781 (1,433,903)
(1,432,119)
281,268
281,268
15 - (281,268) 281,268
-
3
3 1,781 (1,152,635)
(1,150,851)
-
-
Balance at 1 January 2024
Loss and Total Comprehensive
Expense for the Year
Transfer to Revaluation Reserve
Balance at 31 December 2024
Balance at 1 January 2025
Profit and Total Comprehensive
Income for the Year
Transfer to Revaluation Reserve
Balance at 31 December 2025
-
-
3
A non-statutory and non-GAAP Statement of Changes in Equity reflecting adjustments representing the difference between the value of Currency Transactions and the
price of Currency Securities is set out in note 15 to the financial statements.
The notes on pages 24 to 43 form part of these financial statements
- 22 -
www.wisdomtree.eu
WisdomTree Foreign Exchange Limited
Statement of Cash Flows
For year ended 31 December 2025
2025
2024
Notes
USD USD
Cash Flows from Operating Activities
Fees and Expenses Paid
(1,841,422)
(1,635,455)
Bank Interest
3 6,720
10,440
Cash used in Operating Activities
(1,834,702)
(1,625,015)
Cash Flows from Investing Activities
Net Daily Payment Amounts
7 (53,726,296)
(37,534,465)
Net Movement on Currency Transactions
(10,928,250)
85,081,236
Net Cash Flows (used in)/generated from Investing Activities
(64,654,546)
47,546,771
Cash Flows from Financing Activities
Issue of Currency Securities
8 365,050,651
156,105,518
Redemption of Currency Securities
8 (298,907,545)
(202,373,451)
Net Cash Flows generated from/(used in) Financing Activities
66,143,106
(46,267,933)
Net Movement in Cash and Cash Equivalents
(346,142)
(346,177)
Cash and Cash Equivalents at the Beginning of the Year
861,340
1,207,517
Cash and Cash Equivalents at the End of the Year
5
515,198 861,340
Cash and Cash Equivalents at the End of the Year is represented by:
Cash and Cash Equivalents
185,717
129,311
Cash held for Currency Securities due for settlement
329,481
732,029
5
515,198 861,340
Under the terms of the service agreement with ManJer, it receives creation and redemption fees directly from the holders of Currency Securities who have entered into
an authorised participant agreement with the Company (“Authorised Participants”), and accordingly, there are no related cash flows through the Company in respect of
creation and redemption fees. These fees are disclosed in note 3 to the financial statements.
The notes on pages 24 to 43 form part of these financial statements
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Year ended
31 December
Year ended
31 December
Cash Flows from Investing Activities represent amounts linked to Currency Transactions entered into with a Currency Transaction Counterparty, and which are used to
enter into USD, GBP or EUR denominated daily repurchase transactions with the Currency Transaction Counterparty in exchange for eligible collateral on the terms
described in the Company’s Prospectus (collectively the “Underlying Assets”). On each day the Currency Transaction Counterparty is required to pay back the USD,
GBP and EUR amounts in exchange for the eligible collateral held the previous day, which allows the Company to enter into new daily repurchase transactions in
exchange for eligible collateral required on that day, however in accordance with the terms of a supplemental agreement to the Collateral Administration Master
Agreement those new daily repurchase transactions can be paired with maturing deals on the previous daily repurchase transactions meaning that the net amounts (in
each of USD, GBP and EUR) are transferred each day. A daily payment amount will also be calculated in respect of each Currency Transaction on each day to reflect the
movement in the relevant currency index and this amount will also be payable by either the Company or the Currency Transaction Counterparty. Each of these cash
flows are reported on a net basis because the cash receipts and payments relates to items in which the turnover is quick, the amounts are large, and the maturities are
short.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements
For year ended 31 December 2025
1.
General Information
(1)
(2)
As a result of the service agreement with ManJer, the Company recognises a result before fair value movements of nil for each year.
a management fee which is calculated by applying a fixed percentage to the Contractual Value of Securities in issue on a daily basis, less any expenses directly
incurred (the “Management Fee”); and
apply creation and redemption fees on the issue and redemption of the Securities.
No creation or redemption fees are payable to the Company when investors trade in the Securities on a listed market such as the London Stock Exchange.
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WisdomTree Foreign Exchange Limited (the “Company”) is a company incorporated and domiciled in Jersey. The address of the registered office is IFC 5, St Helier,
Jersey, JE1 1ST.
The Company’s principal activity is the issue and listing of collateralised currency securities (“Currency Securities”). Currency Securities are undated secured limited
recourse financial instruments designed to provide investors with long or short exposure to the daily foreign exchange performance of developed or emerging market
currencies or baskets of developed market currencies measured against the US Dollar (“USD”), the Euro (“EUR”) or the British Pound (“GBP”), less applicable fees.
This is achieved by the Currency Securities tracking published currency indices. The price of the Currency Securities is calculated on a daily basis to reflect the change
in the relevant currency index and takes into account the payment of a management fee and a daily spread. The Currency Securities are denominated in USD,EURor
GBP.
Each time Currency Securities are issued or redeemed, corresponding Currency Transactions between the Company and the Currency Transaction Counterparty are
created or closed by the Company. Cash received by the Company linked to Currency Transactions entered into with a Currency Transaction Counterparty is used to
enter into a USD, GBP or EUR denominated daily repurchase transaction with the Currency Transaction Counterparty in exchange for eligible collateral on the terms
described in the Company’s Prospectus (collectively the “Underlying Assets”). On each day the Currency Transaction Counterparty is required to pay back the USD,
GBP and EUR amounts in exchange for the eligible collateral held the previous day, which allows the Company to enter into new daily repurchase transactions in
exchange for eligible collateral required on that day, however in accordance with the terms of a supplemental agreement to the Collateral Administration Master
Agreement those new daily repurchase transactions can be paired with maturing deals on the previous daily repurchase transactions meaning that the net amounts (in
each of USD, GBP and EUR) are transferred each day. This daily process therefore ensures that eligible collateral (at market fair value) received from the Currency
Transaction Counterparty represents at least 100% of the exposure of the daily repurchase transaction receivable on a daily basis. A daily payment amount will also be
calculated in respect of each Currency Transaction on each day to reflect the movement in the relevant currency index and this amount will also be payable by either the
Company or the Currency Transaction Counterparty.
Each class of Currency Security is issued under limited recourse arrangements whereby the holders have recourse only to the relevant Underlying Assets held to support
the Currency Securities and not to the Underlying Assets of any other class of Currency Security or to the Company. The Company does not make gains from trading in
the Underlying Assets. As a result, (and with the exception of the impact of management fees), from a commercial perspective gains and losses in respect of Currency
Transactions will always be offset by a corresponding loss or gain on the Currency Securities and therefore commercially the Company does not retain any net gains or
losses or net risk exposures. However, the difference in valuation between Currency Transactions and Currency Securities creates a mis-match between accounting
values reported within these financial statements. This difference in valuation would be reversed on a subsequent redemption of the Currency Securities and transfer of
the corresponding Currency Transactions because the redemption of securities are at the contractual value and not at their IFRS 13 fair value. Further details are
disclosed within the Accounting Policies and in note 15 to the financial statements with additional information regarding the risks of the Company disclosed in note 12
to the financial statements. Furthermore, the Company presents an adjusted Statement of Profit or Loss and Other Comprehensive Income and an adjusted Statement of
Changes in Equity in note 15 to the financial statements to reflect the economic results of the Company through the reversal of the difference in valuation between
Currency Transactions and Currency Securities given the gain or loss would be reversed on a subsequent redemption of the Currency Securities and cancellation of the
corresponding Currency Transactions, and therefore will not be realised.
Exchange-traded products are not typically actively managed, are significantly lower in cost when compared to actively managed mutual funds and are easily accessible
to investors. No trading or management of futures contracts is required of the Company because the Company has entered into arrangements to acquire an equivalent
asset exposure from a third party which fully hedges the exposure of the Company.
The Company is entitled to:
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
2.
Material Accounting Policy Information
Basis of Preparation
Critical Accounting Estimates and Judgements
Significant Estimates
Significant Judgements
Going Concern
The nature of the Company’s business dictates that the outstanding Currency Securities may be redeemed at any time by Authorised Participants and in certain
circumstances by individual holders and also, in certain circumstances, may be compulsorily redeemed by the Company. As the redemption of Currency Securities will
always coincide with the closing of an equal amount of Currency Transactions, liquidity risk is mitigated through this process which is considered to minimize exposure
to liquidity risk. All other expenses of the Company are met by ManJer. The directors closely monitor the financial position and performance of ManJer, its assets under
management, and therefore its related revenue streams, in respect of fulfilling the obligations under the services agreement.
As Currency Transactions are held to support Currency Securities, any deficit or surplus reported on unrealised positions would be reversed on a subsequent redemption
of the Currency Securities and the related transfer of Currency Transactions. A reported deficit is not considered indicative of any issues relating to solvency of the
Company and the directors are satisfied that any obligations arising in respect of the Currency Securities can be managed in accordance with the terms of the applicable
Prospectus. The directors continue to monitor the price changes impacting Currency Transactions. Market volatility increased at the beginning of 2026 due to the impact
of geopolitical developments, including the recent significant escalation of conflict in the Middle East since February 2026, which has heightened regional instability
and continues to create rapidly evolving geopolitical and economic conditions. These developments may influence market sentiment and global economic activity, and
the directors remain alert to any potential implications for the Company’s operations and Currency Transactions and, will take any potential actions needed or as
required under the terms of the prospectus, as facts and circumstances are subject to change and may be specific to investments and jurisdictions. The directors consider
the operations of the Company to be ongoing, with a reasonable expectation that the Company has adequate resources to continue in operational existence until 30 April
2027(being the period of assessment), and accordingly these financial statements have been prepared on the going concern basis.
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The financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting
Standards Board (“IASB”), and interpretations issued by the IFRS Interpretations Committee of the IASB. The financial statements have been prepared under the
historical cost convention, as modified by the revaluation of certain financial assets and financial liabilities held at fair value through profit or loss.
The Board of Directors (the “Board”) has concluded specifically that climate change, including physical and transition risks, does not have a material impact on the
recognition and separate measurement considerations of the assets and liabilities in these financial statements as at 31 December 2025. This conclusion is based on the
fact that assets are reported at fair value under IFRS, are short dated, and as set out in note 12 to the financial statements are categorised as Level 2 of the fair value
hierarchy due to the use of observable, verifiable inputs, including use of third party information sources within the agreed pricing formulae (set out in the Prospectus).
The liabilities are valued using listed market prices at year end. These observable inputs and market prices will reflect wider market sentiment, which inherently includes
market perspectives relating to the impact of climate change.
The presentation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its
judgement in the process of applying the Company’s accounting policies. The Company makes estimates and assumptions that affect the reported amountsofassetsand
liabilities. Estimates are continually evaluated and based on historical experience and other factors, including expectations of future events that are believed to be
reasonable under the circumstances.
The directors do not consider that any significant estimates have been applied in the preparation of these financial statements.
The key accounting judgement required to prepare these financial statements is in respect of the presentation of non-statutory and non-GAAP adjustments to the
Statement of Profit or Loss and Other Comprehensive Income and the Statement of Changes in Equity, as disclosed in note 15 to the financial statements.
The material accounting policies of the Company are described below.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
2.
Material Accounting Policy Information (continued)
Accounting Standards
(a)
Standards, amendments and interpretations considered by the Company:
•
(b)
New and revised IFRSs in issue but not yet effective:
•
•
•
•
The directors do not expect the adoption of the above standards, amendments and interpretations that are in issue but not yet effective will have a material impact
on the financial statements of the Company in future periods.
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There were no other new standards, amendments and interpretations adopted in the current year that resulted in a significant effect on these financial statements.
The new and amended standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements are
disclosed below. The Company intends to adopt these new and amended standards and interpretations, if applicable, when they become effective.
IFRS 18 - Presentation and Disclosure in Financial Statements (effective for reporting periods beginning on or after 1 January 2027)
IFRS 19 - Subsidiaries without Public Accountability: Disclosures (effective for reporting periods beginning on or after 1 January 2027)
Amendments to IFRS 9 and IFRS 7 - Amendments to the Classification and Measurement of Financial Instruments (effective for reporting periods beginning
on or after 1 January 2026)
Annual Improvements to IFRS Accounting Standards - Volume 11 (effective for reporting periods beginning on or after 1 January 2027)
The following are standards and amendments effective for accounting periods beginning on or after 1 January 2025 but which did not have any effect on the
financial statements of the Company.
Amendments to IAS 21 - The Effects of Changes in Foreign Exchange Rates: lack of exchangeability.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
2.
Material Accounting Policy Information (continued)
Currency Transactions
•
•
i) Issue and Redemption
Financial assets are recognised and de-recognised on the transaction (trade) date.
ii) Classification
•
•
iii)
Pricing
Currency Securities
i)
Issue and Redemption
Financial liabilities are recognised and de-recognised on the transaction (trade) date.
The fair value of the Daily Payment Amount component of the Currency Transactions is calculated based on the movement in the performance of the relevant
MSFXsm Currency Indices. The MSFXsm Currency Indices are total return indices and are calculated and published by Morgan Stanley and are calculated in
accordance with the MSFXsm Indices Manual.
The combination of the value of the Daily Repurchase Transactions and the fair value of the Daily Payment Amount represents the fair value of the Currency
Transactions. This valuation methodology is consistent with the formula set out in the Prospectus whereby a single price is established for each Currency
Transaction as at the end of each Pricing Day (the Contractual Value).
Each time a Currency Security is issued or redeemed by the Company a corresponding number and value of Currency Transactions are created or closed with
Morgan Stanley. The Currency Securities give rise to the financial liabilities. Upon initial recognition, the fair value is recorded using the price calculated based
on the formula set out in the Prospectus, referred to as the “Contractual Value”. Each time a Currency Security is issued or redeemed by the Company a
corresponding amount of Currency Transaction is transferred into or from the relevant secured account held by the Custodian. The issue and redemptionof
Currency Securities is recorded at a value that corresponds to the value of the Currency Transaction transferred in respect of the issue and redemption. As a result,
the Company has no net exposure to gains or losses on the Currency Securities and Currency Transaction.
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Daily Repurchase Transactions: Cash received by the Company (linked to Currency Transactions entered into with a Currency Transaction Counterparty) which
is used to enter into a USD, GBP or EUR denominated daily repurchase transaction with the Currency Transaction Counterparty in exchange for eligible
collateral on the terms described in the Company’s Prospectus. Each day the Currency Transaction Counterparty pays back the USD, GBP and EUR amounts in
exchange for the eligible collateral held the previous day, allowing the Company to enter into new daily repurchase transactions in exchange for eligible collateral
required on that day, however in accordance with the terms of a supplemental agreement to the Collateral Administration Master Agreement those new daily
repurchase transactions can be paired with maturing deals on the previous daily repurchase transactions meaning that the net amounts (in each of USD, GBP and
EUR) are transferred each day. This daily process ensures that eligible collateral (at market fair value) received from the Currency Transaction Counterparty
represents at least 100% of the exposure of the daily repurchase transaction receivable on a daily basis.
Daily Payment Amount: calculated in respect of each Currency Transaction on each day to reflect the movement in the relevant currency index and this amount
will be payable by either the Company or the Currency Transaction Counterparty.
Each time a Currency Security is issued or redeemed by the Company, a corresponding number and value of Currency Transactions are created or closed with
Morgan Stanley & Co. International plc (“Morgan Stanley”), which represent financial assets of the Company. Upon initial recognition, the value is recorded
using the price calculated based on the formula set out in the Prospectus.
Each Currency Transaction comprises two financial instruments whose aggregate cancellation price is linked to the performance of the relevant currency index.
The Currency Transactions are classified as financial assets, and are recognised as follows:
the amount receivable from the Currency Transaction Counterparty in respect of the Daily Repurchase Transactions is recognised at amortised cost; and
the Daily Payment Amount is recognised at fair value through profit or loss under IFRS 9 due to this being a derivative financial instrument.
The Currency Securities are backed by Currency Transactions, which are unfunded currency transactions with terms corresponding to the terms of Currency Securities.
The Currency Transactions are made up of two components on each day:
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
2.
Material Accounting Policy Information (continued)
Currency Securities (continued)
ii)
Classification at fair value through Profit or Loss
iii)
Pricing
Currency Transactions and Currency Securities Awaiting Settlement
Cash and Cash Equivalents
Other Financial Assets and Liabilities
Other financial assets and liabilities are non-derivative financial assets and liabilities including trade and other receivables and trade and other payables with a fixed
payment amount and are not quoted in an active market. After initial measurement the other financial assets and liabilities are subsequently measured at amortised cost
using the effective interest method less any allowance for expected credit losses. The effective interest method is a method of calculating the amortised cost of an
instrument and of allocating interest over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash flows (including all fees
paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt
instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition. Impairment losses, including reversals of impairment losses and
impairment gains, are recorded through profit or loss.
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IFRS 13 requires the Company to identify the principal market and to use the price available in that market. The Directors consider the stock exchanges on which
the Currency Securities are listed to be the principal market, based on the greatest volume and level of trading activity and liquidity overall. Accordingly, the fair
value of the Currency Securities is determined using quoted on‑exchange prices reflecting active trading. This represents the price at which the liability would be
transferred to a market participant at the measurement date, as required by IFRS 13, and not the price at which the liability would be extinguished. Where the
reporting date does not fall on a day on which the relevant exchange is open, the valuation is based on the most recent available quoted price prior to the reporting
date.
As a result, a difference arises between the value of the Currency Transactions held to support the Currency Securities and the fair value of the Currency
Securities presented in the Statement of Financial Position. This difference is temporary and reverses on the subsequent redemption of the Currency Securities
and the transfer of the corresponding Currency Transactions, as the Securities are redeemed at their contractual value rather than their IFRS 13 fair
value.
The issue and redemption of Currency Securities, and the creation or closure of Currency Transactions, is accounted for on the transaction date. The transaction will not
settle until two days after the transaction date. Where transactions are awaiting settlement at the year end, the value of the Currency Transactions and the Currency
Securities due to be settled is separately presented within the relevant assets and liabilities on the Statement of Financial Position. The fair value of these receivables and
payables is considered equivalent to their carrying value.
The Company has established separate Cash Accounts (GBP, USD and EUR) with the Bank of New York Mellon (“BoNY”) as well as Overdraft Facilities, linked to
each of the Cash Accounts, which together facilitate the cash flows related to the receipt and payment of amounts on the creation and redemption of Securities as well as
the transfer of the Daily Payment Amounts required for the subsequent days daily repurchase transaction. Cash and Cash Equivalents include deposits held on call with
BoNY.
Each Currency Security comprises a financial instrument whose redemption price is linked to the performance of the relevant currency index adjusted by the
applicable fees and expenses.
The Currency Securities are classified as financial liabilities measured at fair value through profit or loss under IFRS 9 due to an embedded derivative. This also
significantly reduces a measurement or recognition inconsistency that would otherwise arise from measuring assets or liabilities or recognising the gains and
losses on them on different bases.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
2.
Material Accounting Policy Information (continued)
Reserves
Income and Expenses
i)
Management Fees
•
3x and 5x Leveraged Currency Securities have a management fee rate of 0.98% per annum;
•
CNY Currency Securities have a management fee rate of 0.59% per annum; and
•
All remaining classes of Currency Securities have a management fee rate of 0.39% per annum.
ii)
Creation and Redemption Fees
Foreign Currency
Segmental Reporting
A segment is a distinguishable component of the Company that is engaged either in providing products or services (business segment), or in providing products and
services within a particular economic environment (geographical segment), which is subject to risks and rewards that are different from those of other segments. IFRS 8
requires operating segments to be identified on the basis of internal reports about components of the Company that are regularly reviewed by the Chief Operating
Decision Maker (“CODM”) in order to allocate resources to the segments and to assess their performance. The CODM has been determined as the Board of Directors.
Whilst the Company has a number of different Currency Securities in issue, the financial information reviewed by CODM is not segregated by those different Currency
Securities and therefore the Board has concluded that these components do not meet the criteria of operating segments. Furthermore, marketing of the Currency
Securities is undertaken on a centralised basis and the terms of the Currency Securities of any class rank pari passu in all respects irrespective of stock exchange listing.
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The Company has entered into a service agreement with WisdomTree Management Jersey Limited (“ManJer” or the “Manager”), whereby ManJer is responsible for
supplying or procuring the supply of all management and administration services required by the Company (including marketing) as well as the payment of costs
relating to the listing and issue of Currency Securities. In return for these services, the Company has an obligation to remunerate ManJer with an amount equal to the
aggregate of the management fee and the creation and redemption fees, less any expenses directly incurred (the “ManJer Fee”).
The Company derives its income over time (in respect of management fees), and at a point in time (in respect of creation and redemption fees) as follows:
The Company earns a management fee based upon the contractual value of Currency Securities in issue, expressed as an annual percentage, calculated on adaily
basis and reflected in the net asset value (“NAV”) of the securities on a daily basis, and paid monthly in arrears. Management Fees are calculated by applying a
fixed percentage to the Contractual Value of Currency Securities in issue on a daily basis in accordance with the terms of the securities issued:
Fees for the issue and redemption of Currency Securities are recognised at the fair value of the consideration expected to be received, on the date on which the
transaction becomes legally binding. Accrued creation and redemption fees are invoiced on a quarterly basis and settled directly between ManJer and the relevant
Authorised Participants.
The financial statements of the Company are presented in the currency in which a majority of the Currency Transactions entered into and the Currency Securities issued
by the Company are denominated (its functional currency). For the purpose of the financial statements, the results and financial position of the Company are expressed
in United States Dollars ("USD"), which is the functional currency of the Company, and the presentation currency of the financial statements.
Transactions in foreign currencies are initially recorded at the spot rate at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at
the year-end date are translated at rates ruling at that date. Creation and redemption fees are translated at the average rate for each month in which they are incurred. The
resulting differences are accounted for through profit or loss.
A revaluation reserve and a retained earnings reserve are maintained within equity. All profit or loss is taken to the retained earnings reserve at the end of the accounting
period to which it relates and the gain or loss relating to the mis-match of accounting values is transferred to the revaluation reserve, which the directors have deemed to
be non-distributable, as the balance relates to unrealised gains and losses on Currency Transactions (held to support the Currency Securities) and Currency Securities,
which are reversed on a subsequent redemption of the Currency Securities and the related cancellation of Currency Transactions and will therefore not be realised.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
2.
Material Accounting Policy Information (continued)
Segmental Reporting (continued)
3.
Result Before Fair Value Movements
2025
2024
USD USD
Management Fees
1,891,108
1,590,272
Bank interest received
6,720
10,440
Total Income
1,897,828
1,600,712
ManJer Fees
(1,897,828)
(1,600,712)
Total Operating Expenses
(1,897,828)
(1,600,712)
Result Before Fair Value Movements
- -
4.
Taxation
5.
Cash, Cash Equivalents
2025
2024
USD USD
Cash and Cash Equivalents
185,717
129,311
Cash held for Currency Securities due for settlement
329,481
732,029
515,198 861,340
Audit Fees for the year amounting to GBP 44,130 will be met by ManJer (2024: GBP 49,883).
The Company is subject to Jersey Income Tax. During the year the Jersey Income Tax rate applicable to the Company is zero percent (2024: zero percent).
As at
31 December
As at
31 December
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As a result, the CODM determined that the Company is operating a single segment or product group, Currency Securities, and one geographical segment which is
Europe. Therefore the Company discloses its results on an equivalent aggregated form and does not provide any further segmental information. In addition, the
Company has no single major customer from which greater than 10% of income is generated. All information relevant to the understanding of the Company’s activities
is included in these financial statements.
Result Before Fair Value Movements for the year comprised:
Year ended
31 December
Year ended
31 December
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
5.
Cash and Cash Equivalents (continued)
6.
Trade and Other Receivables
2025
2024
USD USD
Amounts Receivable from Related Party
1,781
1,781
Amounts Receivable on Stated Capital
3
3
1,784
1,784
7.
Currency Transactions
2025
2024
USD USD
52,653,742
(36,297,242)
Currency Transactions at Fair Value
314,977,914
194,351,614
•
•
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As at
31 December
As at
31 December
Change in Contractual and Fair Value of Currency Transactions
As at 31 December 2025, there were certain Currency Transactions awaiting settlement in respect of the creation or redemption of Currency Securities with transaction
dates before the year end and settlement dates in the following year:
The amount of cash received from the Currency Transactions (Daily Repurchase Transactions) and held (per note 5 to the financial statements) in respect of
Currency Securities awaiting settlement is USD 329,481 (2024: USD 732,029), with a further amount receivable on Currency Transactions awaiting settlement of
USD Nil (2024: USD 620,649), giving a total unsettled balance of USD 329,481 (2024: USD 1,352,678).
The amount payable on Currency Transactions (Daily Repurchase Transactions) awaiting settlement is USD 2,765,455 (2024: USD 68,092).
Under the terms of the Collateral Administration Master Agreement, the Company has established and maintains Custody Accounts with BoNY (as both Custodian and
Collateral Administrator) in respect of its dealings with the Currency Transaction Counterparty. The Company has also established separate Cash Accounts (GBP, USD
and EUR) with BoNY, as well as Overdraft Facilities, linked to each of the Cash Accounts, which together facilitate the cash flows related to the receipt and payment of
amounts on the creation and redemption of Securities as well as the transfer of the Daily Payment Amounts required for the subsequent days daily repurchase
transaction.
The net amount of cash held, or overdraft facility utilised, at the close of each day is equal to the amounts accrued but not yet transferred in respect to management fees,
net of any interest applied to the Cash Accounts by BoNY as well as cash transferred out from the Daily Repurchase Transactions to facilitate the redemption of
Currency Securities awaiting settlement.
As at
31 December
As at
31 December
The fair value of these receivables is equal to the carrying value. The Trade and Other Receivables are due to be recovered within 12 months of the year end.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
7.
Currency Transactions (continued)
2025
2024
USD USD
Opening Currency Transactions
194,351,614
278,693,826
Daily Repurchase Transactions
14,246,262
(85,579,435)
Net Daily Payments Amounts
53,726,296
37,534,465
Change as a result of Daily Payment Amounts (Invested into Currency Transactions)
52,653,742
(36,297,242)
Closing Currency Transactions
314,977,914
194,351,614
2025
2024
USD USD
2,890,215
(552,557)
Daily Repurchase Transactions
312,807,115
194,190,968
Daily Payment Amount
(811,626)
260,928
Closing Currency Transactions
314,977,914
194,351,614
8.
Currency Securities
The daily payment amount constitutes a derivative which is calculated in respect of each Currency Transaction on each day to reflect the movement in the relevant
currency index and this amount will be payable by either the Company or the Currency Transaction Counterparty.
Whilst the Currency Securities are quoted on the open market, the Company’s ultimate liability relates to its contractual obligations to issue and redeem Currency
Securities at set prices on each trading day. These prices are based on agreed formulae, and are equal to the published net asset value (“NAV”) of each class of Currency
Security. Therefore, the actual contractual issue and redemption of Currency Securities occur at a price that corresponds to the fair value of the Currency Transactions.
As a result, the Company has no net exposure to gains or losses on the Currency Securities and Currency Transactions.
The Company measures the Currency Securities at their fair value in accordance with IFRS 13 rather than at the Contractual Value (as described in the Prospectus). The
fair value is the price quoted on stock exchanges or other markets where the Currency Securities are listed or traded.
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As at
31 December
As at
31 December
Currency Transactions awaiting settlement (and transfer into Daily Repurchase
Amounts received on Currency Transactions (awaiting transfer into Daily Repurchase
Transactions)
92,211
452,275
The below table shows a reconciliation of changes in the Currency Transactions, based upon the underlying factors that result in changes, and does not represent the
transaction cash flows which are settled on a net basis as described in the Statement of Cash Flows:
Year ended
31 December
Year ended
31 December
The Currency Transactions are unfunded currency transactions with terms corresponding to the terms of Currency Securities. The Currency Transactions are made up as
follows:
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
8.
Currency Securities (continued)
2025
2024
USD USD
Change in Fair Value of Currency Securities
(52,372,474)
34,324,128
Currency Securities at Fair Value
316,130,549
195,785,517
2025
2024
USD USD
Change in Contractual Value of Currency Securities
(52,653,742)
36,297,242
Currency Securities at Contractual Value
314,977,914
194,351,614
•
The amount receivable on Currency Securities awaiting settlement is USD 2,765,455 (2024: USD 68,092).
•
The amount payable on Currency Securities awaiting settlement is USD Nil (2024: USD 620,649).
2025
2024
USD USD
Opening Currency Securities
195,785,517
278,154,615
Securities Created
367,748,014
155,782,792
Securities Redeemed
(297,884,348)
(202,237,490)
Management Fee
(1,891,108)
(1,590,273)
Change in Fair Value
52,372,474
(34,324,127)
Closing Currency Securities at Fair Value
316,130,549
195,785,517
As at 31 December 2025, there were certain Currency Securities awaiting settlement in respect of creations or redemptions with transaction dates before the year end
and settlement dates in the following year:
The below tables shows a reconciliation of changes in the Currency Securities, being liabilities arising from financing activities:
Year ended
31 December
Year ended
31 December
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As at
31 December
As at
31 December
The Contractual Values and changes thereof during the year based on the contractual settlement values are:
As at
31 December
As at
31 December
The gain or loss on the difference between the value of the Currency Transactions and the fair value of Currency Securities would be reversed on a subsequent
redemption of the Currency Securities and closure of the corresponding Currency Transactions. Refer to note 15 to the financial statements for the non-statutory and non-
GAAP adjustments which reflect this reversal. This difference is reversed on a subsequent redemption of the Currency Securities and the transfer of the corresponding
Currency transactions where the redemption of securities are at the contractual value and not at their IFRS 13 fair value.
The fair values and changes thereof during the year based on prices available on the open market as recognised in the financial statements are:
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
8.
Currency Securities (continued)
The below tables shows a reconciliation of the movement on financing activities:
2025
2024
USD USD
Opening Currency Securities
195,785,517
278,154,615
Cash Received from the Issue of Currency Securities
365,050,651
156,105,518
Cash Paid on the Redemption of Currency Securities
(298,907,545)
(202,373,451)
Net Cash Movements
66,143,106
(46,267,933)
Management Fees
(1,891,108)
(1,590,273)
Non-Cash Movements on Amounts Receivable and Payable
3,720,560
(186,765)
Non-Cash Change in Fair Value
52,372,474
(34,324,127)
Net Non-Cash Movements
54,201,926
(36,101,165)
Closing Currency Securities
316,130,549
195,785,517
9.
Trade and Other Payables
2025
2024
USD USD
ManJer Fees Payable
185,717
129,311
10.
Stated Capital
2025
2024
USD USD
2 Shares of Nil Par Value, Issued at GBP 1 Each and Fully Paid
3
3
The fair value of these payables is equal to the carrying value. The ManJer Fee Payable is due to be settled within 12 months of the year end.
As at
31 December
As at
31 December
The Company can issue an unlimited capital of Nil par value shares in accordance with its Memorandum of Association.
All Shares issued by the Company carry one vote per Share without restriction and carry the right to dividends. All Shares are held by WisdomTree Holdings Jersey
Limited (“HoldCo”).
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Year ended
31 December
Year ended
31 December
As at
31 December
As at
31 December
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
11.
Related Party Disclosures
Fees charged by ManJer during the year:
2025
2024
USD USD
ManJer Fees
1,891,108
1,590,272
The following balances were due to ManJer at year end:
2025
2024
USD USD
Amount Receivable
1,781
1,781
ManJer Fees Payable
(185,717)
(129,311)
(183,936)
(127,530)
The following balances were due from HoldCo at the year-end:
2025
2024
USD USD
Stated Capital
3
3
No director has a service contract with the Company. The directors of the Company who are employees within the WisdomTree, Inc group do not receive separate
remuneration in their capacity as directors of the Company. The directors of the Company who are employees of Apex Financial Services (Alternative Funds) Limited
(“Administrator”) do not receive separate remuneration in their capacity as directors of the Company, however Apex Financial Services (Alternative Funds) Limited
receives a fee from ManJer which includes services in respect of the Company, including for the provision of directors who are employees of Apex Financial Services
(Securities) Limited.
Vinod Rajput, Elisabeth Casely and Olivia Vuillemin (up to his date of resignation) are employees of Apex. During the year, Apex charged ManJer administration fees
which include the company and other entities for which the ManJer is the Manager and Apex is the Administrator.Total fee amounting GBP 1,324,915 (31 December
2024: GBP 1,647,534) translated in USD 1,781,746 (31 December 2024: USD 2,114,712), of which GBP 429,076 (31 December 2024: GBP 471,388) translated in
USD 577,021 (31 December 2024: USD 590,885) was outstanding at the year end.
Timothy Darcy is an employee of WisdomTree Ireland Limited, a wholly owned subsidiary of WisdomTree, Inc. Peter Ziemba was an executive officer of WisdomTree,
Inc. group and Bryan Governey is European General Counsel for the WisdomTree, Inc group.
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Entities and individuals which have a significant influence over the Company, either through ownership or by virtue of being a director of the Company, are considered
to be related parties. In addition, entities with common ownership to the Company and entities with common directors are also considered as related parties.
Year ended
31 December
Year ended
31 December
As at
31 December
As at
31 December
As at
31 December
As at
31 December
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
12.
Financial Risk Management
(a)
Credit Risk
x
x
cash received in respect of the creation of further Currency Securities; less
x
cash to be paid on that subsequent day to satisfy the redemption of Currency Securities; less
x
any cash which reflects accrued but unpaid management fees.
This daily process ensures that eligible collateral (at market fair value) received from the Currency Transaction Counterparty represents at least 100% of the value of the
cash paid for the daily repurchase transaction entered into. This eligible collateral is held in accounts with the custodian, and exists to reduce potential credit risk if the
Currency Transaction Counterparty were to default in respect of the Daily Repurchase Transactions component of the Currency Transactions where, if the Currency
Transaction Counterparty defaults on its obligation, the Company may exercise its rights to realise such eligible collateral. The realised value of the collateral may differ
from the amount owed by the Currency Transaction Counterparty, as prices fluctuate intraday (i.e. from the last point the exposure and eligible collateral were valued).
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Credit risk primarily refers to the risk Authorised Participants or the Currency Transaction Counterparty will default on their contractual obligations resulting in
financial loss. Each class of Currency Security is issued under limited recourse arrangements whereby the holders have recourse only to the relevant Currency
Transactions (held to support the Currency Securities) and not to the Currency Transactions of any other class of Currency Securities or to the Company, therefore
limiting the credit risk of the Company in connection with the issue of the Currency Securities.
The Company has entered into a facility agreement with Morgan Stanley enabling the Company to create and cancel Currency Transactions on an on-going basis.
Morgan Stanley is currently the only Currency Transaction Counterparty. If Morgan Stanley discontinued the provision of Currency Transactions and the existing
Currency Transactions expired without a replacement Currency Transaction Counterparty being appointed, the Company would be required to redeem the outstanding
Currency Securities. There are compulsory redemption provisions as outlined in the prospectus that can be triggered by the Company or the Currency Transaction
Counterparty in certain circumstances whereby a compulsory redemption of all Currency Securities in issue would be undertaken. The total carrying amount of the
Currency Transactions, cash & cash equivalents, cash held for currency securities due for settlement, amounts receivable awaiting settlement and trade and other
receivables best represent the maximum such credit risk exposure at the Statement of Financial Position date. At the reporting date the Company’s Currency
Transactions amounts receivable awaiting settlement and trade and other receivables are detailed on the Statement of Financial Position.
Cash received by the Company linked to Currency Transactions entered into with a Currency Transaction Counterparty is used to enter into a USD, GBP or EUR
denominated daily repurchase transaction with the Currency Transaction Counterparty in exchange for eligible collateral on the terms described in the Company’s
Prospectus. On each day the Currency Transaction Counterparty is required to pay back the USD, GBP and EUR amounts in exchange for the eligible collateral held the
previous day, which allows the Company to enter into new daily repurchase transactions in exchange for eligible collateral required on that day, however in accordance
with the terms of a supplemental agreement to the Collateral Administration Master Agreement those new daily repurchase transactions can be paired with maturing
deals on the previous daily repurchase transactions meaning that the net amounts (in each of USD, GBP and EUR) are transferred each day. The daily repurchase
transaction entered into on each subsequent day is adjusted to reflect:
the aggregate net amount payable or receivable between the Company and the Currency Transaction Counterparty under all Currency Transactions; plus
The Company is exposed to a number of risks arising from its activities including credit risk, liquidity risk, settlement risk and market risk. The Board is responsible for
the overall risk management approach and for approving the risk management strategies and principles. The Board meets frequently to consider the risk exposures of the
Company and to determine appropriate management policies. The risk management policies employed by the Company to manage these are discussed below. The
information provided below is not intended to be a comprehensive summary of all the risks associated with the Currency Securities and investors shouldrefertothe
most recent Prospectus for a detailed summary of the risks inherent to investing in the Currency Securities. Any data provided should not be used or interpreted as a
basis for future forecast or investment performance. The Currency Securities are subject to normal market fluctuations and other risks inherent to investing in securities
and other financial instruments. There can be no assurance that any appreciation in the value of securities will occur, and the capital value of an investor’s original
investment is not guaranteed. The value of investments may go down as well as up, and an investor may not get back the original amount invested.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
12.
Financial Risk Management (continued)
(a)
Credit Risk (continued)
(b )
Liquidity Risk
(c)
Settlement Risk
Amounts outstanding in respect of positions yet to settle are disclosed in notes 7 and 8 to the financial statements.
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities as they fall due. The Company’s
payables are all payable on demand and generally settled on a short-term basis. Liquidity risk in respect of payables related to expenses is reduced as amounts in respect
of the Management Fee are secured by the Company on a daily basis, in order for the ManJer expense accumulated (for the month, in arrears) to be settled once
invoiced, and amounts in respect of the creation and redemption fees are transferred from the relevant counterparties directly to ManJer and there are no related cash
flows through the Company. Each class of Currency Security is issued under limited recourse arrangements whereby the holders have recourse only to the relevant
Currency Transactions (held to support the Currency Securities) and not to the Currency Transactions of any other class of Currency Securities or to the Company,
therefore limiting the credit risk of the Company in connection with the issue of the Currency Securities.
The Currency Securities do not have a contractual maturity date and will only be redeemed at the request of the holder of the security, which may be requested at any
time, or in the case of a compulsory redemption. Generally, only Authorised Participants can submit applications and redemptions directly with the Company.
The agreements with the Currency Transaction Counterparty include limits (both daily and in the aggregate) on the issue and cancellation of Currency Transactions, and
the Company is not obliged to issue and redeem Currency Securities in excess of those limits under the terms of the security agreement. Furthermore, liquidity risk of
the Company is mitigated because the rights and obligations on the issue redemption of the Currency Securities and the issue and cancellation of Currency Transactions
are matched, therefore the Company does not have to wait for a longer-term contract to mature in order to pay its debts to ex-security holders. Consequently, the
Company has not presented any quantitative information in respect of liquidity risk.
Settlement risk primarily refers to the risk that an Authorised Participant or the Currency Transaction Counterparty will default on its contractual obligations resulting in
financial loss.
The directors believe that settlement risk would only be caused by the risk of the Company’s trading counterparty not delivering cash, Currency Securities or Currency
Transactions on the settlement date. The directors believe that this risk is mitigated as a result of the cash or Currency Securities settling through the CREST system.
The system ensures that the transaction does not settle until both parties have fulfilled their contractual obligations.
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Eligible collateral can include cash invested in fixed income and money market funds or supranational bonds with a minimum rating of AAA, G10 and other European
government bonds with minimum rating of AA, US Agencies 100% backed by the government, or in eligible equities (that belong to specified indices that include the
major benchmarks such as S&P 500 and EURO STOXX 50, and other developed market indices such as NASDAQ and STOXX 600). These eligible collateral rules
apply strict margins and concentration limits to reduce the risk of such a loss, but do not completely remove it. Full details of “Eligible Collateral” can be found in the
Eligible Collateral Schedule through the Company’s website.
Eligible collateral with a market fair value of USD 316,373,473 was held in custody as at 31 December 2025 (2024: USD 194,675,749) in respect of the Daily
Repurchase Transaction entered into on that day (calculated in accordance with the description above). The Currency Transactions backed by the collateral held in
custody as at 31 December 2025 was USD 312,807,115 (2024: USD 194,190,968), disclosed as Daily Repurchase Transactions in note 7 to the financial statements. As
a result of the collateral held, the Company’s credit exposure to any Currency Transaction Counterparty in respect of Currency Transactions is intended to be limited on
any day to the aggregate of amounts related to Currency Transactions not yet settled, amounts related to Currency Transactions not yet transferred into the Daily
Repurchase Transactions and the daily payment amounts due but not settled. Accordingly, no impairment to reflect expected credit loss has been provided for. The
market fair value for the eligible collateral is calculated on a daily basis (by BoNY) using the most recently available closing bid price.
The Board monitors credit risk exposure, including through an assessment of the credit rating Morgan Stanley (Morgan Stanley: AA- (2024: A+) (Fitch, 21 May
2025), to ensure the Company’s exposure is managed, and 'and is continuing to do so more closely with a focus on any potential impact.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
12.
Financial Risk Management (continued)
(d)
Capital Management
(e)
Market Risk
i) Price Risk
However, there is an inherent risk from the point of view of investors as the values of currencies, and thus the value of the Currency Securities, may vary widely due to,
amongst other things, changing supply and demand for a particular currency, government and monetary policy or intervention, interest rate levels and global or regional
political, economic or financial events. The market price of Currency Securities is (and will remain) a function of supply and demand amongst investors wishing to buy
and sell Currency Securities and the bid or offer spread that the market makers are willing to quote. This is highlighted further in note 15 to the financial statements, and
below under the Fair Value Hierarchy.
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The primary objective of the Company’s capital management policy is to ensure that it maintains sufficient resources for operational purposes. The capital being
managed is the Stated Capital as presented in the Statement of Changes in Equity. Retained Earnings and the Revaluation Reserve, as presented in the Statement of
Changes in Equity, are not considered managed capital as these balances relate to unrealised gains and losses on Currency Transactions (held to support the Currency
Securities) and Currency Securities, which are reversed on a subsequent redemption of the Currency Securities and the related cancellation of Currency Transactions and
will therefore not be realised. The Company is not subject to any capital requirements imposed by a regulator and there were no changes in the Company’s approach to
capital management during the year.
The Company’s principal activity is the issue and listing of Currency Securities. These Currency Securities are issued and redeemed as demand requires. The Company
holds a corresponding number of Currency Transactions which matches the total contractual liability of the Currency Securities issued. ManJer supplies or arranges the
supply of all management and administration services to the Company and pays all management and administration costs of the Company, including trustee and
custodian fees. In return for these services the Company pays ManJer a fee, which under the terms of the service agreement is equal to the aggregate of the Management
Fee and creation and redemption fees earned.
As all Currency Securities in issue are supported by an equivalent number of Currency Transactions held with the Currency Transaction Counterparty and the running
costs of the Company were paid by ManJer, the directors of the Company consider the capital management and value of its current capital resources are adequate to
maintain the ongoing listing and issue of Currency Securities.
Market risk is the risk that changes in market prices (such as index and equity prices, interest rates and foreign exchange rates) will affect the Company’s income or the
value of its financial instruments held or issued.
As described above, Currency Securities provide investors with long or short exposure to the daily foreign exchange performance of developed and emerging market
currencies measured against USD, EUR or GBP. The value of the Company’s liability in respect of the Currency Securities fluctuates according to the performance of
the underlying currency index and the risk of such change in price is managed by the Company by entering into Currency Transactions with the Currency Transaction
Counterparty which match the liability. The obligation of the Company to holders of the Currency Securities is limited to the net proceeds of the class collateral pool,
which comprises rights under the Currency Transactions and daily repurchase transactions entered into with the Currency Transaction Counterparty. Whilst the
Currency Securities are quoted on the open market, the Company’s ultimate liability relates to its contractual obligations to issue and redeem Currency Securities at set
prices on each trading day. The Company measures the Currency Securities at their fair value in accordance with IFRS 13 rather than at the Contractual Value (as
described in the Prospectus). The gain or loss on the difference is reversed on a subsequent redemption of the Currency Securities and the transfer of the corresponding
Currency transactions where the redemption of securities are at the contractual value and not at their IFRS 13 fair value. Refer to notes 7 and 8 to the financial
statements for the further details regarding fair values.
The Company therefore bears no residual financial risk on a contractual basis from a change in the value of a currency or currency index by reference to the futures
price. Furthermore, the impact of price sensitivity is considered immaterial to these financial statements.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
12.
Financial Risk Management (continued)
(e)
Market Risk (continued)
i) Price Risk (continued)
ii) Interest Rate Risk
iii) Currency Risk
(f)
Sensitivity Analysis
IFRS 7 requires disclosure of a sensitivity analysis for each type of market risk to which the Company is exposed to at the reporting date, showing how profit or loss and
equity would have been affected by a reasonably possible change to the relevant risk variable.
The Company’s obligations and liability in respect of Currency Transactions and Currency Securities, respectively, relates to its contractual obligations to issue and
redeem Currency Securities at set prices on each trading day. The fair value of each creation and redemption of Currency Securities is recorded using the price
calculated based on the formula set out in the Prospectus. However, under IFRS 13, the liability is recorded at fair value (being the on-exchange price)whichresultsina
mismatch. As described in note 15 to the financial statements this mismatch is reversed on the redemption of Currency Securities.
As a result, the Company’s contractual and economic liability in connection with the issue and redemption of Currency Securities is matched by movements in
corresponding Currency Transactions. Whilst sensitivity analysis could be performed on this mismatch, the Company does not have any net exposure to market price
risk. Furthermore the result of the numeric sensitivity is considered not material by, the directors and in their opinion, no sensitivity analysis is required to be disclosed.
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In some cases, movements in exchange rates can be so significant that they lead to the level of a Currency Index for any class falling to zero. Since leveraged
currency indices provide leveraged exposure to daily changes in foreign exchange rates calculated against a base value determined on the second previous
business day, it is possible that in certain highly volatile markets a leveraged currency index may fall to zero where the foreign exchange rate moves byalarge
amount over the course of two trading days or even where a particular exchange rate moves by a very large amount over the course of one day. In these
circumstances the collateralised Currency Securities for that class may become subject to compulsory redemption at a zero price. In such situations,the
collateralised Currency Securities may be redeemed for no value and the holder of the Currency Security will receive no payment on that redemption. Such events
have not occurred during the current and prior years.
The Company holds custody accounts with BoNY and this is where the cash received in connection with the issue of Currency Securities and received under the
Currency Transactions is held. The majority of such cash is used to enter into daily repurchase transactions with the Currency Transaction Counterparty. The
pricing of the Currency Transactions or the Currency Securities takes into account the incremental capital enhancement component of the Currency Security,
which includes the impact of interest rates. This incremental capital enhancement component of the Currency Transactions and Currency Securities is attributable
to the security holder. As a result, the Company does not have significant exposure to interest rate risk.
The Company has exposure to currency risk as the Currency Securities provide investors with long or short exposure to the daily foreign exchange performance
of developed and emerging market currencies measured against USD, EUR or GBP. However, the directors do not consider the Company to have a significant
exposure to currency risk arising from the current economic uncertainties facing a number of countries around the world as the gains or losses on the liability
represented by the Currency Securities are matched economically by corresponding losses or gains attributable to the Currency Transactions.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
12.
Financial Risk Management (continued)
(g)
Fair Value Hierarchy
The levels in the hierarchy are defined as follows:
x
Level 1 fair value based on quoted prices in active markets for identical assets.
x
Level 2 fair values based on valuation techniques using observable inputs other than quoted prices.
x
Level 3 fair values based on valuation techniques using inputs that are not based on observable market data.
The categorisation of the Company’s assets and (liabilities) measured at fair value are as shown below:
2025
2024
USD USD
Level 1
Currency Securities
(304,267,026)
(188,421,086)
Level 2
Currency Securities
(11,863,523)
(7,364,431)
Currency Transactions (Daily Payment Amount)
(811,626)
260,928
The Daily Repurchase Transactions component of Currency Transactions totalling USD 312,807,115 (2024: USD 194,190,968) is recognised at amortised cost, in line
with the Company’s accounting policy. The fair value of the Daily Repurchase Transactions is considered to be approximately equal to its carrying value due to the daily
maturity. The collateral consists of Level 1 financial instruments.
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Categorisation within the hierarchy is determined on the basis of the lowest level input that is significant to the fair value measurement of each relevant asset/liability.
The Company is required to utilise the available on-market price as the Currency Securities are quoted and traded on the open market. Where the market on which the
Currency Securities prices are quoted is determined to be active at the relevant reporting date, the Currency Securities are classified as Level 1 financial liabilities.
Where the market on which the Currency Securities prices are quoted is determined to be inactive at the relevant reporting date, the Currency Securities are classified as
Level 2 financial liabilities. The Company values the Level 2 Currency Securities using the unadjusted latest traded market price available at each reporting date. This is
considered to most appropriately reflect the price at which transactions would occur as at the reporting date.
The Company’s rights in respect of Currency Transactions relate to its contractual obligations to issue and redeem Currency Securities at set prices on each trading day.
These prices are based on an agreed formula (set out in the Prospectus), and are equal to the published NAVs of each class of Currency Security. Therefore, Currency
Transactions are classified as Level 2 financial assets, as the Company’s asset is calculated using third party pricing sources supported by observable, verifiable inputs.
Fair Value as at 31
December
Fair Value as at 31 December
The Currency Securities and the Daily Payment Amount component of Currency Transactions are recognised at fair value upon initial recognition and revalued to fair
value in line with the Company’s accounting policy. There are no assets or liabilities classified in Level 3.
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
12.
Financial Risk Management (continued)
(g)
Fair Value Hierarchy (continued)
2025
2024
USD USD
Level 1 to Level 2
6,417,359
6,574,064
Level 2 to Level 1
5,362,108
1,039,034
13.
Ultimate Controlling Party
14.
Subsequent Events
15.
Non-GAAP and Non-Statutory Information
In accordance with the disclosure requirements of IFRS the directors have determined that no entity meets the definition of immediate parent or ultimate controlling
party. The holder of issued equity shares is Electra Target HoldCo Limited, a Jersey registered company. WisdomTree, Inc (formerly WisdomTree Investments, Inc) is
the ultimate controlling party of HoldCo.
The Directors have evaluated events occurring after the reporting date up to the date of approval of these financial statements and have determined that there were no
events subsequent to 31 December 2025 that require adjustment to, or disclosure in, the financial statements. No matters have arisen that would materially affect the
Company’s financial position, performance, or the presentation of these financial statements.
As a result of the mis-match in the accounting valuation of Currency Transactions (held to support the Currency Securities) and Currency Securities (as disclosed in
notes 7 and 8 to the financial statements) the profits and losses and comprehensive income of the Company presented in the Statement of Profit or Loss andOther
Comprehensive Income reflect gains and losses which represent the movement in the cumulative difference between the value of the Currency Transactions and the
price of Currency Securities. The Statement of Changes in Equity also reflects the fair value movements on both the Currency Transactions (held to support the
Currency Securities) and the Currency Securities.
These gains or losses on the difference between the value of the Currency Transactions (held to support the Currency Securities) and the price of Currency Securities
would be reversed on a subsequent redemption of the Currency Securities and cancellation of the corresponding Currency Transactions. Furthermore, each class of
Currency Security is issued under limited recourse arrangements whereby the holders have recourse only to the relevant Currency Transactions (held to support the
Currency Securities) and not to the Currency Transactions of any other class of Currency Security or to the Company. As a result, the Company does not make gains
from trading in the underlying Currency Transactions (held to support the Currency Securities) and, from a commercial perspective (with the exception of the impact of
Management Fees) gains and losses in respect of Currency Transactions (held to support the Currency Securities) will always be offset by a corresponding loss or gain
on the Currency Securities and the Company does not retain any net gains or losses.
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Transfers between levels are recognised if the primary market on which the Commodity Securities prices are quoted was determined to be inactive at the relevant
reporting date. The Company considers both the last trade date and trading volumes during the 5 trading days leading up to each reporting date to determine if the
market for a particular Commodity Security is active. Transfers as a result of the analysis of the activity levels of the market are identified and recognised at each
reporting date. The Company considers both the last trade date and trading volumes during the 5 trading days leading up to each reporting date to determine if the
market for a particular Currency Security is active. Transfers as a result of the analysis of the activity levels of the market are identified and recognised at each reporting
date.
As at 31 December 2025, Currency Securities with a fair value were transferred as per below table.
Year ended 31 December
Year ended 31 December
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
15.
Non-GAAP and Non-Statutory Information (continued)
The mismatched accounting values are as shown below:
2025
2024
USD USD
Change in Contractual and Fair Value of Currency Transactions
52,653,742
(36,297,242)
Change in Fair Value of Currency Securities
(52,372,474)
34,324,128
281,268
(1,973,114)
(a)
Non-GAAP and Non-Statutory Statement of Profit or Loss and Other Comprehensive Income
2025
2024
USD USD
Income
1,897,828
1,600,712
Expenses
(1,897,828)
(1,600,712)
Result Before Fair Value Movements
-
-
Change in Fair Value of Currency Transactions
52,653,742
(36,297,242)
Change in Fair Value of Currency Securities
(52,372,474)
34,324,128
Profit / (Loss) for the Year
281,268
(1,973,114)
Adjusted Result
-
-
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Year ended 31 December
Year ended 31 December
To reflect the commercial results, the Company has presented below a non-GAAP and non-Statutory Statement of Profit or Loss and Other Comprehensive Income and
Statement of Changes in Equity for the year which reflect an Adjustment from Market Value to Contractual Value (as set out in the Prospectus) of Currency Securities,
together with those gains or losses being transferred to a separate reserve which is deemed non-distributable.
Year ended 31 December
Year ended 31 December
Adjustment from Market Value to Contractual Value (as set out in the Prospectus) of
Currency Securities
(281,268)
1,973,114
WisdomTree Foreign Exchange Limited
Notes to the Financial Statements (continued)
For year ended 31 December 2025
15.
Non-GAAP and Non-Statutory Information (continued)
(b)
Non-GAAP and Non-Statutory Statement of Changes in Equity
Share
Capital
USD USD USD USD USD
3 1,781 539,211 540,995 1,784
- (1,973,114) - (1,973,114) (1,973,114)
Transfer to Revaluation Reserve
- 1,973,114 (1,973,114)
-
-
-
- - - 1,973,114
Balance at 31 December 2024
3 1,781 (1,433,903) (1,432,119) 1,784
3 1,781 (1,433,903) (1,432,119) 1,784
- 281,268 - 281,268 281,268
Transfer to Revaluation Reserve
- (281,268) 281,268 - -
Balance at 31 December 2025
3 1,781 (1,152,635) (1,150,851) 1,784
4
This represents the difference between the value of Currency Transactions and the price of Currency Securities
-
-
-
-
(281,268)
- 43 -
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Balance at 1 January 2024
Result and Total Comprehensive
Expense for the Year
Adjustment from Market Value to
Contractual Value (as set out in
the Prospectus) of Currency
Securities
Balance at 1 January 2025
Result and Total Comprehensive
Income for the Year
Adjustment from Market Value to
Contractual Value (as set out in
the Prospectus) of Currency
Securities
Retained
Earnings
Revaluation
Reserve
4
Total
Equity
Adjusted
Total Equity