There are different types of FX exposure a company may face: transactional and operational. For businesses that trade overseas in different currencies, currency volatility and how to mitigate that risk is an important consideration.
A spot FX trade is a straightforward foreign currency exchange. Using real-time exchange rates, we offer confidential same-day, next day and spot foreign exchange transaction services in over 60 different currencies. We access multiple pools of liquidity to secure sharper pricing, enabling our clients to benefit from seamless execution and fast, secure settlement.
Monex Europe provides OTC (over-the-counter) deliverable forward contracts for making FX related payments for identifiable goods, services or direct investment.
Forward contracts can be an effective solution to mitigate currency risk, providing certainty and flexibility with business costs such as global payroll, overseas invoices and intercompany transfers. A forward contract;
- Fixes the value of future international payments and receipts.
- Protects profit margins, cash flow and your bottom line from currency fluctuations.
A market order is an order to buy/sell a specified amount of currency at a predetermined rate of exchange not currently achievable. This allows you to get on with your day job and take advantage of market moves without having to keep track of the markets all day long. It also allows you to take advantage of any overnight volatility or illiquidity that you may not necessarily see in normal trading hours. Monex offers two main types of market orders;
Limit order → Typically an order at a target rate better than where the market is currently trading.
A stop loss order → Typically an order to instruct a trade at a predetermined “worst case scenario” rate, to prevent further losses if the markets start to move against you.
Margin credit facilities
As part of our corporate foreign exchange offering, we can offer flexible margin credit facilities to clients looking to hedge up to 5 years ahead. Subject to creditworthiness, these margin facilities may lower or remove the requirement to place initial and/or variation margin with us that would otherwise be required against any forward trades.