Currency forwards

To minimise the risk derived from the exchange rate, we guarantee single FX price at a certain date. In this way, you have a fixed price at maturity, regardless of market’s movements. This makes managing currencies other than euros easier, as you know the costs or revenue from your transaction or investment right from the beginning and you can forget about doing calculations.

• Choose currency forwards if you want to have a fixed trade price at maturity so that the change in the currency price does not affect you. This can be used before maturity by modifying the initial contracted price.
• Choose the American-style currency forward if you are interested in setting an exchange rate for the sale during a certain period, from the start date you need and until the maturity of the operation, so that you can always use the same price during that period.

In the case of currency forwards with settlement, we continue to offer you a single price at maturity for a period of time, but we set a barrier, in such a way that you benefit from all the positive movements of the market until you reach that barrier. Therefore, if the market price is set above the level of the determined barrier, you lose nothing.

The barrier can be:

• European: observed only on the maturity date.
• American: observed continuously throughout the life of the operation.

With an NDF, you eliminate the exchange rate risk of non-deliverable currencies, in other words, there is no physical delivery of currencies as they are only used within the country to which they belong, such as the Chilean peso, and are settled based on the exchange rate differences.

On the maturity date, we look at the difference between the contracted price and that set by the Central Bank of the corresponding country and you get a positive or negative settlement on the account, which will be offset by the price of the physical exchange of the currency in the given country.