Hedge Foreign Exchange Risk in MDL - Moldovan Leu

Drapeau Hedge Foreign Exchange Risk in MDL - Moldovan Leu

Foreign Exchange Risk Coverage on the Moldovan Leu (MDL) with Mondial Change

Mondial Change allows you to hedge your foreign exchange risk on the Moldovan Leu (MDL). Currently, foreign exchange risk coverage on the Moldovan Leu 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 revaluation (or devaluation) of the currency. Therefore, the NDF price will not be linked to the interest rate differential between the two currencies involved. The NDF thus allows you to hedge your foreign exchange risk without any cash flow being exchanged in the non-convertible currency. You can schedule a meeting with our trading desk. An expert market advisor will assist you in setting up your foreign exchange hedges on the Moldovan Leu (MDL).

Mondial Change Answers All Your Questions on Foreign Exchange Risk Coverage for Your Moldovan Leu (MDL) Operations

Are there minimum or maximum amounts for setting up hedges in Moldovan Leu (MDL)?

The maximum amount of hedges in Moldovan Leu (MDL) 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 Moldovan Leu (MDL)?

Generally, we do not offer hedges in Moldovan Leu (MDL) 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 foreign exchange risk hedges in Moldovan Leu (MDL)?

All fees related to setting up hedges in Moldovan Leu (MDL) 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 Moldovan Leu (MDL)?

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 Moldovan Leu (MDL) hedging contracts if the EUR/MDL 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 Moldovan Leu (MDL) contracts open. Based on the review of your financial statements, lines without margin calls may sometimes be granted.

Are there carry points or discount points on forward contracts in Moldovan Leu (MDL)?

It all depends on whether you are a buyer or seller of Moldovan Leu (MDL) and against which currency you are trading the Moldovan Leu. If we take an example against the euro: If you are a buyer of Moldovan Leu (MDL) against the EUR, then there are report points because the interest rate of the Moldovan Leu (MDL) is supérieur to that of the EUR. Conversely, if you are a seller of Moldovan Leu (MDL) against the EUR, then there are déport points.

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