A Forward Contract is a well-known hedging tool used to capture a rate today for a transaction to be settled at some fixed date in the future.  The rate is not based on a spot rate, or upon speculation of what the market may do, but rather, by looking at current interest rates between the two countries.  A forward contract is a binding contract to both parties regardless of market movement.

The following are the different types of forward contract services that Calforex provides to corporate clients:

• Minimum -  $100,000 USD
• Term - greater than 2 days and less than 1 year. 
• Funds exchanged on maturity date – no draw down option
• 5% deposit

2) Draw down contracts

Option #1 on Draw Down forward

• Minimum – 100,000 USD
• Term – 30 day window; can be booked as far as 1 year out
• Draw down – any amount within the 30 day contract commitment/ no minimum draw down amount (eg: $5000)
• 5% deposit

Option #2 on Draw Down Forward

• Minimum -  $100,000.00 USD
• Term – greater than 4 days and less than 6 months
• 90 window necessary to draw down
• No minimum Draw down
• 5% deposit

***A corporate client must read and sign the forward contract sheet before an advisor can lock in the rate with Calforex Suppliers.  Please see attached sample forms for the content of forward contracts.

The client can call Advisors for any questions and clarification of this form. Once a deal is booked, it is a bona fide agreement and a legally binding contract between Calforex and the corporate client. Should the client decide not to go through a completed transaction, Calforex simply cannot cancel the deal since we have to honour our commitment with the suppliers that we booked the deal with.

Therefore, all costs incurred as a result of cancellation of the deal will be passed on to the client. This means that if a client bought a currency from Calforex, Calforex has to buy back that currency on the bid side of the market. If the client sold a currency to Calforex, then Calforex will sell back the currency on the offer side of the market. The cost incurred as a result of doing the reverse of the original transaction will be collected from the client within 2 business days and all related invoices showing required payment will be faxed to client.