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Hedging Foreign Exchange Risk in STD - São Tomé Dobra

Foreign Exchange Risk Coverage on São Tomé Dobra (STD) with Global Exchange

Global Exchange allows you to hedge your foreign exchange risk on São Tomé Dobra (STD). Currently, foreign exchange risk coverage on São Tomé Dobra 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 likelihood 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 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. A market expert advisor will assist you in setting up your São Tomé Dobra (STD) currency hedges.

To obtain accurate quotes on your São Tomé Dobra (STD) hedges, we invite you to contact our trading desk.

Global Exchange Answers All Your Questions on Foreign Exchange Risk Coverage for Your São Tomé Dobra (STD) Transactions

Are there minimum or maximum amounts for setting up São Tomé Dobra (STD) hedges?

The maximum amount of São Tomé Dobra (STD) hedges 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 São Tomé Dobra (STD) hedges?

Generally, we do not offer São Tomé Dobra (STD) hedges 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 São Tomé Dobra (STD) foreign exchange risk hedges?

All fees related to setting up São Tomé Dobra (STD) hedges 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 São Tomé Dobra (STD) hedge?

Again, this depends on the conditions of your forward exchange line. Thanks to its network of partners, Global Exchange generally manages to obtain forward exchange lines without an initial security deposit. Depending on your line conditions, margin calls may be triggered on your São Tomé Dobra (STD) hedging contracts if the EUR/STD 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 São Tomé Dobra (STD) contracts open. Based on the review of your financial statements, lines without margin calls may sometimes be granted.

Are there carry or discount points on São Tomé Dobra (STD) forward contracts?

It all depends on whether you are a buyer or seller of São Tomé Dobra (STD) and against which currency you are trading the São Tomé Dobra. For example, against the euro: If you are a buyer of São Tomé Dobra (STD) against the EUR, then there are déport points because the interest rate of São Tomé Dobra (STD) is inférieur to that of the EUR. Conversely, if you are a seller of São Tomé Dobra (STD) against the EUR, then there are report points.

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