Kolkata based rice bran oil exporter. The client usually hedges his expected export receivables within 2-3 days of receiving the export order. The client booked an export side USD/INR forward contract in last week of July for USD 1,00,000 at a rate of 69.7525 with a fixed date maturity for October end. However, the export order got cancelled and the forward contract was deep out of the money.
Myforexeye Value Addition :
The client approached Myforexeye Advisory team in a state of panic. On the date of maturity of the forward contract, Myforexeye team suggested the client to rollover the forward contract. The forward contract was cancelled at 73.89 with a loss of INR 4,13,750 to the client and it was rebooked for April end at 75.42. In November end, when the USD/INR spot came down by 4 rupees at 69.92, the forward contract came deep in the money. We suggested the client to cancel the forward contract and take the profit. The client went on to cancel the forward contract at a net rate of 71.12 and gained INR 4,30,000 on cancellation. This way the client was able to recover the loss incurred by him earlier and he even made a net profit of INR 16,250 following our advisory. The client felt relieved and was highly satisfied with the Myforexye Advisory.
Date : 1-Dec-2018
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