When conducting transactions with Bulgaria, you may need to send or receive payments in Bulgarian Lev. You are then naturally exposed to currency risk. Indeed, between the time you invoice your client in BGN and the time you collect the BGN, or conversely between the time your supplier issues their invoice in BGN and you settle this invoice in BGN, the EUR/BGN exchange rate may have moved in your favor or against you. To eliminate or minimize this risk of EUR/BGN exchange rate movement (assuming your accounting currency is EUR) over a determined period, you can implement hedges on the EUR/BGN. By locking in the EUR/BGN rate in advance, you gain better visibility on your future cash flows in Bulgarian Lev (BGN) and secure your EUR/BGN budget rate.
Mondial Change allows you to hedge your currency risk on Bulgarian Lev (BGN). Currency risk hedging on Bulgarian Lev can be done through fixed forward contracts or flexible forward contracts. It is also possible to hedge currency risk on BGN using currency options. You can use our hedging assistance tool to help you select the most suitable hedging strategy for your needs. You can also schedule a meeting with our trading desk. An expert market advisor will assist you in setting up your currency hedges on Bulgarian Lev (BGN).
To obtain accurate quotes on your Bulgarian Lev (BGN) hedges, we invite you to contact our trading desk.
Are there minimum or maximum amounts for setting up hedges in Bulgarian Lev (BGN)?
The maximum amount of hedges in Bulgarian Lev (BGN) 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. Regarding 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 Bulgarian Lev (BGN)?
What are the setup fees for currency risk hedges in Bulgarian Lev (BGN)?
All fees related to setting up hedges in Bulgarian Lev (BGN) are included in the exchange rate communicated to you before validating your transaction. The hedging is done by 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 Bulgarian Lev (BGN)?
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 Bulgarian Lev (BGN) hedging contracts if the EUR/BGN rate (or any other pair on which you have validated a hedge) deteriorates beyond the variation margin or beyond your OTM. In this case, you must deposit funds as collateral to keep your Bulgarian Lev (BGN) contracts open. Based on the review of your financial statements, lines without margin calls may sometimes be granted.
Are there minimum amounts for early drawdowns on flexible forward contracts in Bulgarian Lev (BGN)?
No minimum amount for drawdowns on your flexible forward contracts in Bulgarian Lev (BGN). You can draw down autonomously on the online platform as many times as you wish between the contract initiation and the maturity date of your forward contract in Bulgarian Lev (BGN).
What happens at the maturity of my forward contract in Bulgarian Lev (BGN) if I have not used the entirety of my contract?
In this case, there are two possibilities. You can sell the balance of your contract by paying the potential exchange loss if the exchange rate at the time of resale is less favorable than your contract rate. Alternatively, you can ask Mondial Change to extend your Bulgarian Lev (BGN) contract by a few months to give you time to use it. Mondial Change and its partners, however, reserve the right not to accept postponing the contract maturity date.
What is the current interest rate on Bulgarian Lev (BGN)?
The current interest rate on Bulgarian Lev (BGN) is « Currency Rate ».
Are there carry points or discount points on forward contracts in Bulgarian Lev (BGN)?
It all depends on whether you are a buyer or seller of Bulgarian Lev (BGN) and against which currency you are trading the Bulgarian Lev. If we take an example against the euro: If you are a buyer of Bulgarian Lev (BGN) against the EUR, then there are déport points because the interest rate of the Bulgarian Lev (BGN) is inférieur compared to that of the EUR. Conversely, if you are a seller of Bulgarian Lev (BGN) against the EUR, then there are report points.
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