FX Forward is an agreement between UBB and the client, pursuant to which currencies are purchased and sold on prices agreed now, but with delivery on certain future date at a so called forward rate. This is an agreement legally binding both to UBB and its client - without the requirement to transfer funds before the agreed future date.

When dealing FX Forward the client is required to secure a collateral deposit that guarantees the execution of the deal at the future date. The amount of the collateral deposit depends on the volatility (fluctuation) of the FX rate of the particular currency pair.

Advantages:

• Eliminates the uncertainty resulting from exchange rates fluctuations
   
• Facilitates precise budgeting
   
• Enables the company to concentrate on its main activity and not on day to day exchange rates fluctuations
   
• The use of FX forward does not encumber the customer with additional costs.

Shortcomings:

• FX forwards do not allow clients to generate FX gains in case of spot rate being more favourable on the value date than the agreed forward rate.

For more details please call us at +3592 8112440, +3592 8112442  и +3592 8112439, или e-mail: stefanov_va@ubb.bg, mays_k@ubb.bg, krasteva_b@ubb.bg