When conducting transactions with Australia, you may need to send or receive payments in Barbados Dollar. You are then naturally exposed to foreign exchange risk. Indeed, between the time you invoice your client in BBD and the time you collect the BBD, or conversely between the time your supplier issues an invoice in BBD and you settle that invoice in BBD, the EUR/BBD exchange rate may have moved in your favor or against you. To eliminate or minimize this risk of EUR/BBD rate movement (assuming your accounting currency is EUR) over a specified period, you can implement hedges on the EUR/BBD. By locking in the EUR/BBD rate in advance, you gain better visibility on your future cash flows in Barbados Dollar (BBD) and secure your EUR/BBD budget rate.
Mondial Change allows you to cover your foreign exchange risk on the Barbados Dollar (BBD). Currently, foreign exchange risk coverage on the Barbados Dollar can only be achieved through NDF (non-deliverable forwards) contracts. The NDF is a hedging instrument used to cover your foreign exchange risk on partially or non-convertible currencies. At the contract's expiration date, the rate at which the contract was concluded is compared with the fixing rate. The latter is official and published daily by the Central Bank of the concerned country. The NDF price represents the probability of a currency revaluation (or devaluation). Therefore, the NDF price will not be linked to the interest rate differential between the two currencies involved. The NDF thus allows you to cover your foreign exchange risk without any cash flow in the non-convertible currency. You can schedule a meeting with our trading desk. A market expert advisor will assist you in setting up your foreign exchange hedges on the Barbados Dollar (BBD).
To obtain accurate quotes on your Barbados Dollar (BBD) hedges, we invite you to contact our trading desk.
Are there any minimum or maximum amounts for setting up hedges in Barbados Dollar (BBD)?
The maximum amount of hedges in Barbados Dollar (BBD) you can validate primarily depends on the size of the forward exchange line granted to you. The line conditions granted depend on the review of your financial statements. As for minimum sizes, we generally do not take hedges for amounts below 10,000 EUR (or equivalent in other currencies).
What is the maximum possible maturity for hedges in Barbados Dollar (BBD)?
What are the setup fees for foreign exchange risk hedges in Barbados Dollar (BBD)?
All fees related to setting up hedges in Barbados Dollar (BBD) are included in the exchange rate communicated to you before validating your transaction. The hedge is taken over the phone with a trading desk operator. No fees are applied to the use of your hedges.
Is a security deposit required to take a hedge in Barbados Dollar (BBD)?
Again, this depends on the conditions of your forward exchange line. Thanks to its network of partners, Mondial Change generally manages to obtain forward exchange lines without an initial security deposit. Depending on your line conditions, margin calls may be triggered on your Barbados Dollar (BBD) hedging contracts if the EUR/BBD rate (or any other pair on which you have validated a hedge) deteriorates beyond the variation margin or beyond your OTM. In such cases, you must deposit funds as collateral to keep your Barbados Dollar (BBD) contracts open. Based on the review of your financial statements, lines without margin calls can sometimes be granted.
Are there any carry points or discount points on forward contracts in Barbados Dollar (BBD)?
It all depends on whether you are a buyer or seller of Barbados Dollar (BBD) and against which currency you are trading the Barbados Dollar. For example, against the euro: If you are a buyer of Barbados Dollar (BBD) against the EUR, there are 0 points because the interest rate of the Barbados Dollar (BBD) is égal to that of the EUR. Conversely, if you are a seller of Barbados Dollar (BBD) against the EUR, there are 0 points.
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