Below are our FAQ's, hopefully these will answer your questions. If you still have unanswered questions, please contact us and we will be delighted to help.
Why is it more beneficial to come though MFX instead of going to your partners directly?
There is no cost for our service, but we are able to add considerable value through our personal service and being able to understand our client’s specific needs and providing the best possible solutions at the best possible price.
Are you regulated?
Whilst Manx FX is not regulated, we are part of the Manx Financial Group which also owns Conister Bank and Edgewater Associates Limited who are regulated. To maintain the reputation of our group we are subject to similar policies, standards and procedures and share the groups resource with HR, Accounts, Internal Audit and Compliance.
Are your phone lines recorded?
Yes, all of our land line phone calls are recorded to allow for training and reference purposes.
Can you give financial advice?
As an unregulated business we are not allowed to give any advice to clients for regulated activities.
Does entering a forward contract increase or decrease risk?
Due to accountancy reporting rules there is often a misguided interpretation that entering into forward contracts to match your known currency requirements can create future profits or losses that can be avoided if you instead only purchase the currency as and when it is needed. The business reality is completely different, as by locking in your exchange rate to match against known future currency exposures, it fixes an unpredictable variable cost and secures future profits. Therefore when forward contracts are entered into correctly, they eliminate currency risk.
What if I don’t know the exact amount or dates of the future currency exposure – how can I protect against this?
This is a very common situation for businesses as payment dates for the receipt of foreign currency invoices are never exact and amounts can often vary month to month. We would always recommend that businesses build in either a protection clause within their contracts against adverse currency movements or fix a portion of the expected exposure. We are able to facilitate variable settlement dates so forward contracts can be either drawn early or moved to a later date and the amounts can be gradually reduced as required.
What is the best form of hedging against currency exposures?
We normally recommend booking forward contracts because these are the most transparent and cost effective solution. Options can however be designed to match specific contracts so could be preferable in certain circumstances.
What are the pros and cons of a forward contract?
A forward contract removes your currency exposure and replaces it with a fixed known future cost or income that is locked in through the forward exchange rate to match against your future transactions. This prevents any potential benefit being gained if the rate moves more favourably against the original currency exposure as you have locked into your forward contract, but removes any potential losses.
How is my exchange rate calculated?
All pricing is taken directly from live FX market spot rates and adjusted with a pre-agreed FX margin. Unlike most FX brokers, we agree terms with our clients upfront and guarantee to maintain these. The FX margins are normally based on the size of the trade and the overall activity across each account.
Why are forward FX rates different to spot rates?
Forward rates are always linked directly to the prevailing spot rate but have an adjustment for the period between the spot date and forward settlement date with the interest differential of the currencies being transacted.
Are there any hidden fees?
None at all, your company is on a prearranged fixed FX margin from the beginning that won’t be changed unless we agree with you in advance for this to be amended. The FX and online platform is free. Standard payment charges vary depending on the type of account and activity, but are significantly cheaper than banks and where possible we arrange for completely free payments.
How safe are my Funds?
We have carefully selected our partners to ensure your funds have the best possible security. All customers’ funds are safeguarded in segregated client bank accounts and are not combined with their own funds with the exception of our Moneycorp Bank Partner, which holds a full banking license.
Are you able to offer better rates than banks and other FX brokers?
Our Partners have been carefully selected for this very purpose, as they are the largest FX specialists in the UK and hence are able to secure competitive FX rates. Through our partnership arrangement we ensure that our clients are able to consistently receive excellent rates.
Can I obtain payment confirmations to prove a payment has been sent and is there a cost for this service?
We provide SWIFT confirmations that you can send to the recipient as proof of payment absolutely free of charge. These are generated instantly upon sending and received automatically by email.