HEDGING TOOLS
What are foreign exchange derivatives
Foreign exchange derivatives in the Philippines are financial instruments used to manage foreign exchange risk, or the impact of fluctuating currency rates. These typically take the form of forward contracts, futures, options, or swaps.
Foreign Exchange Swaps
Fix the exchange rate to buy or sell foreign currency on a specific date in the future. Available for most major currency pairs such as USD-PHP.
Foreign Exchange Options
Acquire the right to exchange a currency pair at an agreed rate on an agreed date. Available for most major currency pairs such as USD-PHP.
Cross Currency Swaps
Lock in the exchange rate for a series of cashflows in the future, regardless of changes in foreign exchange rates. Available for most major currency pairs such as USD-PHP.
Get started on foreign currency derivatives
A foreign currency derivative is a financial contract between two parties that agree to exchange a specified amount of one currency for another at a future date and at a predetermined rate. These contracts can be used for hedging purposes, as well as for speculation. Here are reasons why you should invest in them:
Foreign currency derivatives can provide investors with protection against adverse movements in exchange rates
Foreign exchange derivatives are contracts that can be used to speculate on movements in exchange rates
They can also be used to hedge against risks associated with international business transactions
Protect yourself through forex risk management
Find financial solutions to meet your company’s specific needs and protect it from risks.
Forex derivatives can be extremely useful in times of market volatility as it protects investors’ portfolios against any potential losses. See how you can benefit from foreign exchange risk management by contacting a licensed trader for more information on available products and how they can be integrated into your risk management practices.
