Strategic vs Tactical Currency Management

As a portfolio manager at a multinational firm, you are tasked with managing the currency exposure of the firm's assets and liabilities. You have the flexibility to choose a strategic or tactical approach to currency management based on the firm's goals and market conditions.

Define the strategic and tactical approaches to currency management. Discuss the advantages and disadvantages of each approach, and provide examples of situations in which one approach may be more beneficial than the other. Finally, articulate how the choice between strategic and tactical currency management should align with the overall investment strategy of the firm.