Hedging Currency Risk in JPY - Japanese Yen
Currency Risk in Japanese Yen (JPY)
When conducting transactions with Japan, you may need to send or receive payments in Japanese Yen. You are then naturally exposed to currency risk. Indeed, between the time you invoice your client in JPY and the time you collect the JPY, or conversely, between the time your supplier issues their invoice in JPY and you settle it in JPY, the EUR/JPY exchange rate may have moved in your favor or against you. To eliminate or minimize this risk of EUR/JPY exchange rate movement (assuming your accounting currency is EUR) over a specified period, you can implement hedges on the EUR/JPY. By locking in the EUR/JPY rate in advance, you gain better visibility on your future cash flows in Japanese Yen (JPY) and secure your EUR/JPY budget rate.
Currency Risk Hedging on Japanese Yen (JPY) with Mondial Change
Mondial Change allows you to hedge your currency risk on Japanese Yen (JPY). Currency risk hedging on Japanese Yen can be done through fixed forward contracts or flexible forward contracts. It is also possible to hedge currency risk on JPY 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 Japanese Yen (JPY).
Mondial Change Answers All Your Questions on Currency Risk Hedging for Your Operations in Japanese Yen (JPY)
Are there minimum or maximum amounts for setting up hedges in Japanese Yen (JPY)?
The maximum amount of hedges in Japanese Yen (JPY) 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 Japanese Yen (JPY)?
Generally, we do not offer hedges in Japanese Yen (JPY) for maturities exceeding 24 months, but this can be considered on a case-by-case basis. Please contact our trading desk for a personalized assessment of your needs.
What are the setup fees for currency risk hedges in Japanese Yen (JPY)?
All fees related to setting up hedges in Japanese Yen (JPY) are included in the exchange rate communicated to you before the validation of 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 Japanese Yen (JPY)?
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 Japanese Yen (JPY) hedging contracts if the EUR/JPY 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 Japanese Yen (JPY) contracts open. Based on the review of your financial statements, lines without margin calls can sometimes be granted.
Are there minimum amounts for early drawdowns on flexible forward contracts in Japanese Yen (JPY)?
No minimum amount for drawdowns on your flexible forward contracts in Japanese Yen (JPY). 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 Japanese Yen (JPY).
What happens at the maturity of my forward contract in Japanese Yen (JPY) 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 request Mondial Change to extend your Japanese Yen (JPY) 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 Japanese Yen (JPY)?
The current interest rate on Japanese Yen (JPY) is "Currency Rate".
Are there carry points or discount points on forward contracts in Japanese Yen (JPY)?
It all depends on whether you are a buyer or seller of Japanese Yen (JPY) and against which currency you are trading the Japanese Yen. For example, against the euro: If you are a buyer of Japanese Yen (JPY) against the EUR, there are déport points because the interest rate of Japanese Yen (JPY) is inférieur to that of the EUR. Conversely, if you are a seller of Japanese Yen (JPY) against the EUR, there are report points.