Do I need to pay upfront when I book a Forward Contract?

You may be asked to pay a deposit when you book a Forward Contract. This is a fixed percentage of the value of the transaction – this is most often 5% for a business account and 10% for a personal account. However, this could be more or less depending on the duration and assessment of the Forward Contract, credit limits, and other factors. Your deposit is held until the maturity date specified in the Forward Contract. Please note, you must pay the remaining balance of the total amount due which is the difference between the Forward Contract and your deposit, in addition to any applicable fees by the maturity date. For more information contact an OFXpert. 

*If you book a Forward Contract, it may mean losing out if the market rate improves because you’re contracted to settle at the agreed rate. Read more.