Window FX Forward

Negotiate FX rate for
a certain period of time

In a window FX forward, the client has an obligation to sell one currency and buy another currency at a pre-agreed rate, and the fulfillment of the obligation can be done in parts (disbursements) in a certain interval (window). Usually the quotes for window FX forwards are better than those for flexible forwards.

Features of Window FX forward

Obligation for full performance to maturity

Possibility for partial performances in a certain interval of time

Better quotes than those of the flexible forward

Example: The client enters into a window FX forward, with the obligation to sell EUR 1,000,000 and buy USD 1,190,500 at a maturity date of 30.11.2017 (maturity). The client can make utilizations during the period from 16.10 to 30.11.2017. The client makes two utilizations during the period: EUR 700 000 on 20.10 and EUR 300 000 on maturity (30.11). The utilizations are carried out at the previously agreed rate 1.1905.

Target market of the product

The Window FX Forward is a financial instrument, which the Bank manufactures and distributes as a product. The table below sets out the criteria for determining for which client profile the product is compatible with or not.

	Positive	Negative
Type of clients	all types of clients: retail, professional and eligible counterparties
Clients’ knowledge and experience	- the movement and the possible expectations regarding the hedged reference values; - lost profits or realized losses related to a negative change in reference values; - hedging cash flows by entering a Flexi FX forward in relation to future receipts or payments on liabilities; - the process of permanent collateral maintenance	does not meet the indicated knowledge and experience requirements
Clients’ financial situation with a focus on the ability to bear losses	ability to bear a negative result due to FX rate change within the term of the instrument and its maturity and/or on the date of partial or full take-up
Clients’ risk tolerance and compatibility of the risk	low-risk profile, due to the ultimate objective to fix the FX rate to the expected receipts/payments	inclined to bear the risks of negative deviations of the reference values
Clients’ objectives and needs	hedging adverse FX rate fluctuations or speculating