If you need to manage your currency exposure (and you’ve probably got more than you think) we’ve put together a few articles on the different types of hedging facilities out there.
For those that need to buy or sell a large amount of foreign currency purchase or sale in the future currency forwards let you lock in an exchange rate for up to a year in advance on a buy now pay later basis. You have to put down a small deposit to cover market movements in the meantime and the balance is due on settlement.
Or for those that don’t need the actual currency, but just want to offset potential adverse currency movements there are a few guides on options and futures to consider.
It’s all broken down into handy bite size chunks in sections below:
- Compare currency brokers
- What are currency forwards?
- Currency forward quotes
- FX forward pricing
- Currency forward rates
- Currency forward contract pricing formula
- Forward exchange contract advantages and disadvantages
- Forward exchange contract example
- Forward contract hedge example
- Advantages and disadvantages of future contracts
- Advantages and disadvantages of forward contracts and currency options
- Advantages and disadvantages of option contracts
- Advantages and disadvantages of money market hedge
- Business risks of forward contracts
- Advantages of futures and forwards
- What advantages do futures contracts have over forward contracts
- Currency hedging forward contracts
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Richard started the Good Broker Guide in 2015 and has been a broker for 20 years most recently at Investors Intelligence and previously a multi-asset derivatives broker at MF Global (Man Financial). Richard started his career working as a private client stockbroker at Walker Crips and Phillip Securities (now King and Shaxson) after interning on the NYMEX oil trading floor in New York and London IPE in 2001 & 2000.