If you are in the business of exports or importing goods or services, you need to consider how you will protect yourself against changes in exchange rate movements as even a small variation in the exchange rate could cost your business hundreds if not thousands of pounds.
There are several options you can now protect your business when doing a currency transfer and more importantly you can also secure better foreign exchange business rates ranging from 0.2% to 1% margin rates.
Consider Forward Contracts as an option
Forward contracts allows you business to fix your exchange rate for a future trade, even when you do not have all of your funds available.Forward contracts allows you to take advantage of favourable exchange rates for up to 2 years before you actually need to send or receive currency.
There is a 10% deposit to do a forward contract option payable at the outset, where the remaining balance of 90% is due when the contract matures.
Different Order Types options:
Consider a limit order option which is when you order to buy currency at a pre-determined level better than the current market rate. The foreign exchange business dealers monitor your order 24/7 and your currency is purchased automatically when your target level is achieved.
Stop Loss Order:
Consider a stop loss option, the stop loss order allows you to set a minimum or maximum rate at which to buy your business currency. If the market falls or rises to this rate, your business currency will be traded automatically. The stop loss option gives you peace of mind that you are protected from large exchange rate movements.
You also have the options of using a limit order and stop loss order together, this gives you greater protection against risk and guaranteeing that the currency exchange will be within a certain range.
The foreign currency markets are constantly moving, so business foreign exchange dealers monitor all orders for you and keep you well informed.
Remember orders can be adjusted or cancelled at your instruction at any time prior to being fulfilled and your business will not be asked for any payment until your order has been fulfilled.
Analysis and Market Monitoring:
All foreign exchange specialists in currency trading should have the time and resources to watch the markets for you, alerting your business to any opportunities or risks as they arise.