With the currency markets still very volatile it is important to understand the options available to any clients of Foreign Currency Direct. So, listed below are some of the different contract options available, if you would like to discuss any of these in more details do not hesitate to contact one of our knowledgeable traders by calling us on 0800 328 5884 or if calling from abroad on 0044 1494 725353.
The spot contract is ideal for clients who are looking to exchange currency for immediate delivery, in its simplest form clients fix an exchange rate at the current market prices and are then given two working days to settle the contract. Once the clients funds are received the currency can be sent out immediately. The whole process can take less than 24hours or, if preferred, we can hold currency on account to be sent out at a later date. Either way this contract allows clients to access some of the best exchange rates available.
A forward is a very popular contract option for clients who know they have a pending currency requirement but do not want to pay for the funds immediately. For just a small deposit clients are able to secure exchange rates at the current level for a period in the future, this means that regardless of what happens in the market once the exchange rate is fixed the client knows exactly what they are getting. An example of this contract in use is with a client who is purchasing a property abroad; they will pay a deposit initially, probably using a spot contract, and then will have to pay the balance in three months time. The forward contract helps protect the clients from any currency volatility over that three month period and means that even when the client completes on the property the rates are considerably worse, they still have the original rate protected potentialy saving them thousands.
Market orders involve limit orders and stop loss contracts which basically allow clients to nominate an exchange rate they want to acheive even if the current market price is not at those levels and then let our systems do the work. So for example if the Euro was at 1.1470 and a client needs to buy at 1.15 to stay within their budget they could place a limit order to buy the Euros as soon as it hits 1.15. This means our systems will monitor the market on the clients behalf taking away the stress for the client of having to watch a market that moves every two seconds!
All of these contract types can be tailored to clients individual needs, so if you need to send money abroad make sure you speak with us to find out more.