Characteristics of forward foreign exchange transactions
(1) After signing the contract, both parties do not need to pay foreign exchange or domestic currency immediately, but postpone it to some future time;
(2) The transaction scale is large;
(3) The main purpose of trading is to preserve value and avoid the risk of exchange rate fluctuation;
(4) Contracts signed by foreign exchange banks and customers must be guaranteed by foreign exchange brokers. In addition, customers should also deposit a certain amount of margin or collateral. When the exchange rate changes little, banks can use deposits or collateral to make up for losses. When the exchange rate changes make the customer lose more than the deposit or collateral, the bank shall notify the customer to add the deposit or collateral, otherwise, the contract will be invalid. Deposits deposited by customers are regarded as deposits by banks and bear interest.
Jing, a senior gold foreign exchange analyst, said: the risk of foreign exchange transactions refers to the possibility that economic entities will suffer losses due to changes in foreign exchange rates in transactions denominated and received in foreign currencies. So, how to use foreign exchange transactions to prevent foreign exchange risks?
1. Actively use financial derivatives.
Internationally, derivative financial instruments have developed into the most important means of transaction risk management. At present, more than 3,000 kinds of derivative financial instruments are traded in the financial market. We believe that forward foreign exchange trading and forex futures trading are extremely important for risk prevention. Forward foreign exchange transaction, also known as forward foreign exchange transaction, refers to the way that China enterprises with foreign exchange claims or debts sign forward foreign exchange contracts with banks at the agreed forward exchange rate, stipulate the currency, amount, exchange rate and future delivery time of the transaction, and then deliver the goods on the delivery date stipulated in the contract, so as to avoid the risks brought by exchange rate changes from transaction to payment. The biggest function of using forward contracts is to let enterprises with trading risk positions determine the value of future cash flows. Therefore, enterprises can carry out cost management in advance, determine the sales price and ensure a reasonable profit rate. Futures contracts are standardized contracts concluded by exchanges for futures trading. In forex futures trading, it is a hedging behavior to decide to deliver a certain amount of foreign exchange at a certain exchange rate on a certain date in the future by means of public bidding between the two parties in the exchange, and offset the gains and losses of foreign exchange futures with the gains and losses of spot exchange. Because the hedging transaction of foreign exchange futures can make the importing enterprises lose less foreign exchange when the exchange rate changes are unfavorable to the importing enterprises, and it will make the importing enterprises have less foreign exchange surplus when the exchange rate changes are favorable to the importing enterprises, which is the characteristic of foreign exchange futures hedging.
2. Add the terms of the transaction contract.
In the prevention of foreign exchange trading risks, it is a very important aspect to increase the terms of trading contracts. (1) Add currency hedging clause. Adding currency hedging clause refers to adding a currency with a stable currency different from the contract currency, converting the contract amount into the hedging currency, and then converting the amount expressed in the hedging currency into the contract currency at the market exchange rate for receipt and payment. Because the value of hedging currency is relatively stable, it can reduce the risk of exchange rate changes, so it is usually used for long-term contracts. (2) Increase the risk allocation clause. Risk sharing means that both parties to the transaction share the risks brought by exchange rate changes according to the signed agreement. The main process is to determine the basic price and exchange rate of the product, determine the method and time to adjust the basic exchange rate, determine the range of exchange rate change according to the basic exchange rate, determine the proportion of exchange rate change risk shared by both parties, and adjust the basic price of the product through consultation according to the situation.
3. Reasonable choice of contract currency.
With the gradual improvement of the currency credibility of RMB in neighboring countries and regions, especially with the development of offshore RMB business in Hong Kong, RMB has made steady progress on the road of free convertibility. Import and export enterprises should seize the opportunity to strengthen the proportion of RMB pricing settlement in import and export trade. However, when choosing the contract currency, we should also pay attention to the principle of "hard payment and soft payment", that is, export and loan capital output should strive to use currency, and import and loan capital input should strive to use soft currency. The difficulty of this principle lies in that "hard" and "soft" are not absolute, so it is difficult for enterprise managers to grasp its changing law, so enterprises can establish contact with banks and make a correct judgment on the exchange rate trend with the help of professionals.
4. flexibly grasp the time of receipt and payment.
Enterprises should flexibly grasp the time of receipt and payment according to the actual situation. As an export enterprise, when the denominated currency is on the rise, the later the payment date is, the more exchange rate gains can be received. Therefore, the enterprise should delay the delivery as much as possible within the performance period stipulated in the contract, or provide credit to the foreign party to extend the export bill period. Of course, this can only be done on the basis of mutual consent.
5. Strengthen talent reserve and training.
Preventing foreign exchange trading risks is a highly technical business, and accurately predicting the trend of exchange rate changes is the premise of avoiding foreign exchange risks. The globalization of economy, the development of investment liberalization and the complexity of exchange rate fluctuation put forward higher requirements for the quality of enterprise financial managers. In addition, many large foreign enterprises have established considerable risk management institutions, while most domestic small and medium-sized enterprises can consider establishing and perfecting long-term cooperation mechanisms with banks due to reasons such as funds and experience.