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For access to your online account please contact your personal account manager, alternatively email team@regencyfx.com.
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For access to your online account please contact your personal account manager, alternatively email team@regencyfx.com.
Currency markets move constantly and often unpredictably. If you're making a large international payment, even a small shift in the exchange rate can have a significant financial impact.
One way to reduce this risk is through a Currency Forward Contract, which allows you to lock in exchange rates in advance.
This can help you protect against exchange rate fluctuations and bring greater certainty to your budgeting, whether it's a one-time payment or part of a longer-term plan.
A Currency Forward Contract is a financial agreement that allows you to lock in today’s exchange rate for a payment you plan to make at a future date.
While it doesn’t guarantee the most favourable rate, it provides rate certainty, which is especially useful for large or recurring international payments - such as property purchases, business invoices or overseas tuition.
Forward contracts are used in a variety of scenarios, including:
Buying or selling property abroad
Lock in the exchange rate at the time of deposit to avoid paying more if rates move before completion.
Making regular international transfers.
Expats or retirees can fix their monthly exchange rate to manage consistent expenses.
Paying international suppliers.
Businesses can protect their margins by agreeing on rates ahead of time.
Sending money for education, relocation or investment.
Individuals can reduce the risk of cost increases caused by currency fluctuations.
In each of these cases, the main goal is to create predictability and control by securing a rate in advance.
A forward contract doesn’t eliminate risk entirely but it can make international payments more manageable. Benefits can include:
Rate Certainty
Lock in the exchange rate now, regardless of how the market moves later. This ensures consistency when the time comes to pay.
Budget Control
Know the exact cost of your payment in your local currency, allowing you to plan with more accuracy.
Exposure Management
A forward contract can help protect against exchange rate fluctuations, reducing the potential impact of sudden market changes.
Smaller Upfront Payment
You’ll typically pay a deposit of around 5-10% to secure the contract. The balance is paid when the contract matures.
Flexible Timeframes
Contracts can often be set up to 12 months in advance, depending on your needs and provider.
Liam and Sophie were purchasing a €175,000 property abroad. To manage the risk of a fluctuating exchange rate, they decided to secure a forward contract when their offer was accepted.
By the time the final payment was due, the pound had weakened but their costs remained exactly the same thanks to the rate they had locked in.
Had they waited to convert their funds, they would have needed to pay an additional €12,000.
Read their full story here - https://www.regencyfx.com/currency-forward-contracts
This is one example of how forward contracts can help avoid unexpected cost increases due to market movement.
Forward contracts offer many benefits but like any financial tool, they come with some considerations:
Deposit Required
You’ll usually need to pay a small initial margin (typically 5–10%) to secure your rate.
No Benefit if Rates Improve
When you lock in exchange rates, you gain protection but you also give up the chance to benefit if the market moves in your favor. This is the opportunity cost of using a forward contract.
Changes May Incur Costs
Cancelling or adjusting a forward contract after it’s set up may result in costs, depending on the provider and market conditions.
While a forward contract doesn’t suit every situation, it can be a useful option if you prioritise certainty over speculation. Our team is happy to talk through your circumstances in detail before you commit.
Volatile exchange rates can add uncertainty to important international transactions. A forward contract gives you the option to secure your rate today and plan with greater confidence.
It doesn’t guarantee you’ll save money but it does offer protection from downside risk and the ability to avoid surprises.
If you're looking for a practical way to manage international payments, knowing how to protect against exchange rate fluctuations can make a real difference. A forward contract is one of several tools that can help.
Regency FX are a UK based independent currency broker, specialising in high volume transfers.
We pride ourselves on our premium level of customer service, you will be allocated your own personal account manager whom you will have direct access to.
All funds transferred through Regency FX are made using client segregated accounts in accordance with the FCA (Financial Conduct Authority) guidelines.
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