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Here are some straightforward definitions of the most popular currency contracts. For a more detailed explanation, please contact a Pure FX currency dealer.
Spot Contract (buy now - pay now)
This contract enables you to send currency straight away. We confirm your exchange rate on the phone. Then, once we have received the full settlement amount, we transfer your currency to your nominated beneficiary by priority same day transfer.
Forward Contract (fix rate now - pay later)
This contract enables you to fix the exchange rate at today’s value for a specific time in the future, called the maturity date. You are able to say when you want delivery of the currency and this can be any length of time between 1 week and 12 months. Forward contracts may or may not require a deposit.
Is similar to a forward contract although you are able to draw down funds before the maturity date as and when you require the currency.
An order where you agree to buy or sell currency at a specific rate that is not currently available. With a limit order you are waiting for exchange rates to improve. It is free of charge and good until cancelled.
Stop Loss Order
This is where you agree to buy or sell currency at a specific exchange rate. A stop loss does what it says in the sense that it offers 24 hour protection from negative exchange rate movement, whilst giving you the opportunity to benefit should exchange rates improve. Like a stop loss, it is free of charge and good until cancelled.