One-off transfer: Buying a boat

Ralph Martin found a Sunseeker 66 Manhattan he wanted to buy in June 2010. He needed to pay €875,000 for it in euros.

He booked a forward contract with us in June, paying a 8% deposit, which locked him in to a sterling-euro exchange rate of 1.2210.

By the time the sale of the boat went through at the end of September, the exchange rate had moved to 1.1720. The forward contract saved him a total of £29,962.

The rate could have improved by September too, in which case the boat would have been less expensive.

But Ralph had budgeted to buy the boat at no lower than 1.21 – and fixing the rate in advance allowed him to do this, and ensured there were no nasty surprises on the day if the rates had gone the other way.

Equally, he could have decided to enter into a currency option, which would have allowed him to fix the rate and benefit on half the amount if rates had moved in his favour.

To find out more, call us on 0800 783 6022, or +44 20 7801 9080. Alternatively arrange for us to call you back

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