Deliverable Foreign Exchange
We help our clients manage their foreign exchange requirements, from day to day currency purchases and managing liquidity requirements, to longer term hedging and portfolio management.
Traditionally the foreign exchange market has always settled trades two days after the contract has been agreed. We’re more than happy to do this, but with modern banking, more often than not, our trades settle on the very same day that they are struck. This means we have more time to take advantage of advantageous market moves and nobody is left waiting to be paid.
Using vanilla foreign exchange forwards, we are able to produce simple, cost effective hedging solutions to mitigate some, or eliminate all, FX risk, depending on the clients’ preference. Contracts can range in duration from one week to three years and are referred to as ‘vanilla’ because of their simplicity. We can offer deliverable and ‘non-deliverable contracts, which allow our clients to hedge against more than 75% of the world’s currencies.
Stops & Limits
We can place ‘stop loss’ or ‘limit orders’ into the market on behalf of our clients, to protect a specific budget rate, or to aim to achieve a better rate of exchange than the market is currently offering. These straight forward tools allow our clients the opportunity to participate in further market upside, whilst protecting the rates they need to achieve to ensure they are meeting their budgetary obligations.
A number of our clients conduct swap transactions, to manage their FX liquidity. Swaps allow you to ‘swap’ one currency for another and then back again at a future date without any risk of an adverse market movement eroding the value of the return leg of the transaction. Swaps, much like forwards, can range in tenor from a few days to three years.