Hedge Foreign Exchange Risk in KES - Kenyan Shilling
The Foreign Exchange Risk in Kenyan Shilling (KES)
When conducting transactions with Kenya, you may need to send payments or receive payments in Kenyan Shilling. You are then naturally exposed to foreign exchange risk. Indeed, between the time you invoice your client in KES and the time you collect the KES, or conversely between the time your supplier issues their invoice in KES and you settle this invoice in KES, the EUR/KES rate may have moved in your favor or against you. It is to eliminate or minimize this risk of EUR/KES rate movement (assuming your accounting currency is EUR) over a determined period that you can set up hedges on the EUR/KES. By locking in the EUR/KES rate in advance, you gain better visibility on your future cash flows in Kenyan Shilling (KES) and secure your EUR/KES budget rate.
Foreign Exchange Risk Coverage on Kenyan Shilling (KES) with Mondial Change
Mondial Change allows you to hedge your foreign exchange risk on the Kenyan Shilling (KES). The foreign exchange risk coverage on the Kenyan Shilling can be achieved through fixed forward contracts or flexible forward contracts. 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 Kenyan Shilling (KES).
Mondial Change Answers All Your Questions on Foreign Exchange Risk Coverage for Your Operations in Kenyan Shilling (KES)
Are there minimum or maximum amounts to set up hedges in Kenyan Shilling (KES)?
The maximum amount of hedges in Kenyan Shilling (KES) that 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 Kenyan Shilling (KES)?
Generally, we do not offer hedges in Kenyan Shilling (KES) for maturities exceeding 24 months, but this can be considered on a case-by-case basis. Please contact our trading desk for a personalized study of your needs.
What are the setup fees for hedges against foreign exchange risk in Kenyan Shilling (KES)?
All fees related to setting up hedges in Kenyan Shilling (KES) are included in the exchange rate communicated to you before validating your operation. 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 Kenyan Shilling (KES)?
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 Kenyan Shilling (KES) hedging contracts if the EUR/KES 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 Kenyan Shilling (KES) contracts open. Based on your financial statements, lines without margin calls can sometimes be granted.
Are there minimum amounts for early drawdowns on flexible forward contracts in Kenyan Shilling (KES)?
No minimum amount for drawdowns on your flexible forward contracts in Kenyan Shilling (KES). You can draw autonomously on the online platform as many times as you wish between the contract initiation and the maturity date of your forward contract in Kenyan Shilling (KES).
What happens if at the maturity of my forward contract in Kenyan Shilling (KES) 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. Or you can ask Mondial Change to extend your Kenyan Shilling (KES) contract by a few months to give you time to use it. Mondial Change and its partners reserve the right not to accept extending the contract's maturity date.
What is the current interest rate on the Kenyan Shilling (KES)?
The current interest rate on the Kenyan Shilling (KES) is "Currency Rate".
Are there carry points or discount points on forward contracts in Kenyan Shilling (KES)?
It all depends on whether you are a buyer or seller of Kenyan Shilling (KES) and against which currency you are trading the Kenyan Shilling. For example, against the euro: If you are a buyer of Kenyan Shilling (KES) against the EUR, then there are report points because the interest rate of the Kenyan Shilling (KES) is supérieur compared to that of the EUR. Conversely, if you are a seller of Kenyan Shilling (KES) against the EUR, then there are déport points.