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Booking forward contracts to hedge foreign exchange risk
Booking forward contracts to hedge foreign exchange risk
François Cosnier avatar
Written by François Cosnier
Updated over a month ago

Companies of all sizes face foreign exchange risk when dealing with counterparts, suppliers, clients, partners, subsidiaries, or parent companies in foreign currencies.

Hedging against foreign exchange risk


Forward contracts provide a means for companies to hedge against foreign exchange risk by locking in a specific foreign exchange rate for a defined amount and period. This protects businesses from fluctuations in the foreign exchange market during that time.

Types of forward contracts offered by iBanFirst


iBanFirst allows clients to book multiple types of forward contracts:

  • Forwards: Traditional contracts that fix the exchange rate for a specified amount and duration.

  • Flexible forwards: Offer more flexibility in terms of amounts and timelines.

  • Dynamic forwards: Adapt to market fluctuations, providing a more responsive approach.

Activation and booking of forward contracts


Forward contracts are additional services that must be activated through the platform's settings screen. They need to be instructed via the platform and confirmed over the phone.

Contact


If you would like to learn more about forward contracts and how they can benefit your business, please get in touch with your account manager.

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