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With the EU referendum now announced, and several major banks warning that the pound could be in for a 20% drop in value, our Foreign Exchange Manager Alastair Archbold provides some insight in to the types of contract we offer to protect against adverse exchange rate movements.
Since our last overview, the pound/euro rate has stabilised a little, and recovered slightly from the lows of €1.26 we saw a few weeks ago. The EU referendum has now been announced, and while this did cause some weakness for the pound, things are now a little calmer with GBP/EUR rates steady at around the €1.29 mark.
GBP/EUR exchange rate graph
The referendum is still likely to be the dominating factor in the currency markets for the next few months. This week we saw the European Central Bank announce an extension to its stimulus measures, and this caused the pound/euro exchange rate to briefly spike to €1.3050. However it was soon followed by news that no further drastic action would be taken in Europe after this, and the euro therefore quickly regained some strength.
Several major banks have now warned that the pound could fall as much as 20% should the UK vote to leave the EU. This could make exchanging Sterling for another currency an absolute minefield in the coming months, so it’s an opportune time to take stock of the types of contract we offer to protect against this eventuality. For a more detailed consultation on your particular currency requirements, contact your Foremost Currency Group broker today.
We can guide you through a range of contract options and find one that offers you a host of advantages depending on your situation. I’ve listed the main contracts available below:
Exchange one currency for another, quickly and easily. Send us the funds within two days, and as soon as they clear we will forward the currency to the account you designate. Simple and straightforward. This is the most popular way to buy currency. The rate varies throughout the day as we buy live from the market.
The limit order contract helps you get the rate you want. If you know what exchange rate you will need to buy that villa in Marbella, you can instruct your Foremost Currency Group broker to purchase the euros automatically as soon as the market achieves this rate. A great option if time is on your side and you can afford to wait until the market moves in your favour.
STOP LOSS ORDER
The stop loss order protects you against a drop in the exchange rate. It allows you buy currency if the exchange rate drops to a pre-determined minimum level. Combine it with a limit order and you can hold out for a better rate while protecting yourself from a sudden fall in the market – perfect for budgeting and forecasting.
The forward contract allows you to set the rate for up to 2 years, and guarantees the price protecting you from any market volatility. Or if you feel that the exchange rate is at a high but you haven’t quite found the right property you can use the forward contract to hold that rate of exchange for up to 2 years with just a 10% deposit (payable within two working days) and then settle the balance before the contract expires.
Discuss your currency requirements with Foremost Currency Group today
If you need to buy or sell any international currency, then get in touch with your personal broker today to discuss your options. Taking a pro-active approach to your currency requirements could be a prudent move, so get in touch today to find out the various ways we can help protect you against adverse exchange rate movements.
Notes to editors:
Alastair Archbold is an FX manager on the dealing floor, having been with the Foremost Currency Group for over 6 years. With over 16 years’ experience in the Financial Services sector, he has a wealth of knowledge for any clients entering the often daunting world of the currency markets. In addition to providing clients with incredible exchange rates, he has also written countless FX articles for various national newspapers and international publications.
About Foremost Currency Group
“We are committed to shaking up currency exchange by operating in a smarter, leaner and more efficient way, passing the savings onto you and getting you a better rate – every time you trade. Say goodbye to impersonal service and hello to your new dedicated broker. Committed to working on your behalf to get you the very best deal possible.”
Robin McEwen, Managing Director
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