Forward Contracts
The forward foreign exchange contract allows you to "lock" in an exchange rate for a specific currency amount on a specified date in the future.
You are committing to deliver a pre-agreed and fixed amount of one currency for another on a specified date in the future.
Features
- A range of maturity dates can be chosen, usually out to 2 years
- Allows for translation of currencies at one rate throughout the period of the contract
- It is possible to incorporate a time window into your contract so that you may exercise your contract prior to maturity.
Advantages
- No premium payable
- Allows you to hedge exposure to a currency at a pre-agreed rate
- Establishes a known Budget Rate
Disadvantages
- You give up any gains possible from an improving market
Anglo Irish Bank appreciates that each and every business is unique, to benefit from a more tailored solutionplease contact our Currency Risk Management team.