Forward Contracts
Mitigate your foreign currency risk, control your margins and protect your bottom line.
- Protect your business with a framework allowing you to manage currency exposure
- Improve your overall cost structure, working capital and budget plans
- Take advantage of favorable market fluctuations
- Protect your profit margins and asset base
Foreign exchange solutions that work for me
A forward contract insulates you from adverse currency fluctuations and movements allowing you to effectively control your pricing, profit margins and asset base. Small changes in currency rates can cost your business thousands of dollars in lost revenue.
Executing a Forward Contract at MTFX allows you to:
- Manage your currency exposure
- Improve your ability to effectively manage your payable and receivables while managing both your costing and profit margins
- Ensure your business can manage a stable cash flow to facilitate better business planning
Importers, exporters and companies that conduct business internationally make decisions on profitability that are dependent on future transactions. Managing costing and profit margins can be extremely difficult in volatile markets.
MTFX forward contracts allow you to secure a guaranteed currency exchange rate to be bought or sold at a future date giving you the framework and stability to better facilitate your currency requirements. By securing an exchange rate ahead of time, forward contracts protect your business from eroding profit margins and negative impacts on your foreign currency payables.
MTFX offers two types of forward contracts:
- Fixed dated forward contracts allow you to take delivery of your transaction on a specific date in the future
- Open dated forward contracts allow you to settle contracts between date ranges in the future.
Managing your currency exposure does not mean you have to sacrifice flexibility. At MTFX we work with you to develop strategies to adapt your businesses exposure as your requirements change.
How can forward contracts work for you? Click here for an example of how forward contracts can work for you
Forward Contracts: Your obligations and what you should know
If you are planning to execute a fixed dated forward contract or an open dated forward contract with MTFX, you will be subject to additional terms and conditions. In order to secure a forward contract, a security payment must be received within 24 hours of entering such a contract. The security payment is held as collateral by MTFX against potential future currency positions assumed by MTFX. The security payment is refunded to you upon the settlement of your forward contract.
If you have any questions please contact one of our Account Executives who will be more than happy to assist you.