Dynamic discounting and Dynamic forward contract: Difference between pages
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imported>Doug Williamson (Create page - sources - The Treasurer online - https://www.treasurers.org/hub/treasurer-magazine/corporates-act-mitigate-fx-volatility - Iban first - https://blog.ibanfirst.com/en/what-is-a-dynamic-forward-contract) |
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''Risk management - foreign exchange.'' | |||
A dynamic forward contract is a foreign exchange forward contract that provides additional flexibility to the party hedging its foreign exchange risk. | |||
This effectively provides an option - or options - in favour of the hedger. | |||
The option may be paid for by: | |||
==See also== | *An up front premium; | ||
* [[ | *An adverse forward rate in the contract, compared with the current market forward rate; or | ||
*[[ | *A combination of these. | ||
*[[ | |||
*[[ | |||
*[[ | :<span style="color:#4B0082">'''''Corporates act to mitigate FX volatility'''''</span> | ||
*[[ | |||
Payment fintech Moneycorp suggests a number of ways in which corporates can mitigate the impact of FX exposure... | |||
Make use of forward contracts: Forward contracts, either fixed or dynamic, can be customised to allow companies to lock an exchange rate for a future overseas payment. | |||
:''Philip Smith, editor, The Treasurer online - 14 October 2022.'' | |||
== See also == | |||
* [[Bilateral]] | |||
*[[Contract]] | |||
* [[Deal contingent forward]] | |||
* [[Derivative instrument]] | |||
* [[Fixed forward contract]] | |||
* [[Fixing instrument]] | |||
* [[Foreign exchange forward contract]] | |||
* [[Foreign exchange risk]] | |||
* [[Forward contract]] | |||
* [[Forward discount]] | |||
* [[Forward exchange market]] | |||
* [[Forward foreign exchange rate]] | |||
* [[Forward margin]] | |||
* [[Forward market]] | |||
* [[Forward points]] | |||
* [[Forward premium]] | |||
* [[Forward price]] | |||
* [[Forward rate]] | |||
* [[Futures contract]] | |||
* [[Hedging]] | |||
* [[Risk management]] | |||
* [[Risk response]] | |||
* [[Transfer]] | |||
[[Category:The_business_context]] | [[Category:The_business_context]] | ||
[[Category:Identify_and_assess_risks]] | |||
[[Category:Manage_risks]] | [[Category:Manage_risks]] | ||
[[Category: | [[Category:Risk_frameworks]] | ||
[[Category:Risk_reporting]] | |||
[[Category:Financial_products_and_markets]] | [[Category:Financial_products_and_markets]] | ||
Revision as of 08:28, 15 October 2022
Risk management - foreign exchange.
A dynamic forward contract is a foreign exchange forward contract that provides additional flexibility to the party hedging its foreign exchange risk.
This effectively provides an option - or options - in favour of the hedger.
The option may be paid for by:
- An up front premium;
- An adverse forward rate in the contract, compared with the current market forward rate; or
- A combination of these.
- Corporates act to mitigate FX volatility
Payment fintech Moneycorp suggests a number of ways in which corporates can mitigate the impact of FX exposure...
Make use of forward contracts: Forward contracts, either fixed or dynamic, can be customised to allow companies to lock an exchange rate for a future overseas payment.
- Philip Smith, editor, The Treasurer online - 14 October 2022.
See also
- Bilateral
- Contract
- Deal contingent forward
- Derivative instrument
- Fixed forward contract
- Fixing instrument
- Foreign exchange forward contract
- Foreign exchange risk
- Forward contract
- Forward discount
- Forward exchange market
- Forward foreign exchange rate
- Forward margin
- Forward market
- Forward points
- Forward premium
- Forward price
- Forward rate
- Futures contract
- Hedging
- Risk management
- Risk response
- Transfer
