Window FX Forward
Don’t Know the Exact Payment Date? No Problem.
Secure Your Exchange Rate in Advance While Retaining Settlement Flexibility – Window FX Forward
A Window FX Forward (WF) is designed for businesses engaged in international trade that need to manage foreign exchange risk. Do you know a foreign currency payment or receipt will take place, but not the exact date? A Window FX Forward allows you to lock in an exchange rate in advance while retaining the flexibility to settle the transaction within a pre-agreed window, which can begin up to 60 days before the final settlement date.
The key advantage of a WF is that it offers a more favourable exchange rate than an Amortising FX Forward (AF), while still providing valuable flexibility through a settlement window of up to 60 days.
If you do not know the exact settlement date of future payments or receipts but can estimate it within a period of up to 60 days, a Window FX Forward is likely to be the ideal hedging solution for your business.
We’ll call you and recommend the most suitable FX hedging solution for your business based on your cash flow profile, ensuring it is tailored to your specific requirements and business needs.
Currency Risk Doesn’t Wait for the Exact Payment Date
Many businesses know the month or general period in which a future payment or receipt will occur, but cannot determine the exact date. Even so, they still need to protect their profit margins from adverse exchange rate movements. A Window FX Forward (WF) allows businesses to lock in an exchange rate in advance while retaining the flexibility to settle the transaction at any point within a pre-agreed settlement window.
Comparison of Standard FX Hedging and a Window FX Forward
| Standard FX Forward (SF) | Window FX Forward (WF) | |
|---|---|---|
| Trade Date | 1 July | 1 July |
| Hedged Amount | EUR 100,000 | EUR 100,000 |
| Forward Rate | 25,00 EURCZK | 25,00 EURCZK |
| Settlement | 30 September | Any time between 5 September and 30 September (up to 60 days) |
When a Window FX Forward Is the Right Choice
You do not know the exact invoice payment date, but can estimate it within a settlement window of up to 60 days
Invoices are paid throughout the month and you want to keep each transaction clearly matched to a single hedge — one invoice, one WF
You work with variable payment schedules and prefer greater flexibility rather than being tied to one fixed settlement date
You regularly trade internationally and need to protect both your profit margins and cash flow from exchange rate fluctuations
You want a more favourable rate than an Amortising FX Forward (AF) while retaining greater flexibility than a Standard FX Forward (SF)
Throughout the settlement window, all transactions are settled at the agreed exchange rate, while the length of the window can be tailored to your business needs.
Citfin Tip: In general, the shorter the settlement window, the more favourable the exchange rate tends to be. However, it is important to strike the right balance when determining the length of the window. If the transaction is settled before the end of the agreed window, the final exchange rate may differ due to the forward pricing applicable on the actual settlement date.
How a WF Works in Practice
| Order Secured | 1 July |
| WF Arranged | 1 July |
| Hedged Exchange Rate | 25,00 EURCZK |
| Hedged Amount | EUR 100,000 |
| Start of the Settlement Window | 4 October |
| Latest Settlement Date | 30 November |
| Settlement No. 1 | 7 October – EUR 22,385 |
| Settlement No. 2 | 18 October – EUR 38,466 |
| Settlement No. 3 | 2 November – EUR 15,712 |
| Settlement No. 4 | 30 November – EUR 23,437 |
1) Order Secured – On 1 July, your company signs a contract with a German customer. You know that payments for the goods you export will be received in euros over the coming weeks or months, but the exact payment dates are uncertain. This is the point at which currency risk arises. If the Czech koruna strengthens, you may receive fewer korunas for your euros than you are currently expecting, reducing the profitability of the transaction.
2) Arranging the Hedge – Together with Citfin, you enter into a Window FX Forward (WF) and lock in an exchange rate for a future currency conversion. The agreement includes a settlement window of almost two months, allowing you to draw down and settle the hedge whenever needed within the agreed period, while benefiting from the pre-arranged exchange rate throughout the window.
3) Settlement – Part of the euro proceeds arrive from Germany at the beginning of October, additional funds are received later in the month, and the remainder arrives in November? No problem. A Window FX Forward (WF) allows you to settle the hedge gradually, either in stages or in a single transaction. As long as settlements take place within the agreed window, you continue to benefit from your locked-in exchange rate of 25.00 EURCZK.
4) Peace of Mind and Greater Certainty – If you need to settle part of the euro amount before the settlement window begins, this can still be arranged, although the exchange rate may differ from the original rate. The key advantage of a Window FX Forward (WF) is the certainty of a fixed exchange rate throughout the agreed settlement window, providing greater flexibility while maintaining protection against exchange rate fluctuations.
5) Extension – If payment dates are delayed and part of the transaction cannot be settled within the original period, we can arrange an FX swap with you and roll the entire transaction forward to the next settlement date.
WF is an ideal solution for businesses that operate in the real world rather than according to a fixed payment schedule. It combines a competitive exchange rate with flexibility in settlement, allowing companies to manage their foreign currency payments more efficiently.
Benefits of a Window FX Forward for Exporters and Importers
A single hedge can cover multiple payments within the agreed window period
Draw down the contract gradually in line with actual incoming or outgoing payments
No need to know the exact invoice due dates in advance – simply agree on a settlement window
Protect your margins against adverse exchange rate movements
Improve cash flow planning and cost forecasting
Know today the exchange rate at which you will convert funds in the future
Your First Hedge? Here’s What You Need to Know
Arranging an FX hedge is simpler than you might think. Many businesses assume that currency hedging involves a complex process, extensive paperwork, or sophisticated financial products. In reality, the objective is quite the opposite — to provide greater certainty, stability, and control over future foreign currency payments.
Master Agreement. A Master Agreement is required to enter into forward transactions. Citfin will guide you through the entire process and help you set everything up correctly.
LEI Code. European regulations require a Legal Entity Identifier (LEI) for FX hedging transactions. If you do not yet have one, Citfin can assist you with the application process.
Dedicated Dealer Support. Your dealer will work closely with you on your day-to-day business needs, exchange rate developments, hedge utilisation, settlement rollovers, and the overall hedging strategy. The relationship goes far beyond executing a transaction — it is about the long-term management of your company’s currency risk.
Every Business Requires a Different Solution. Not sure whether an SF, AF, PF, or WF is the right fit for your business? Looking for a different type of hedge, an FX Option, or an option strategy? No problem. Every company operates differently. Some require a fixed settlement date, while others need maximum flexibility. Since 1996, we have been more than just a hedging provider — we have been a trusted partner helping businesses tailor currency risk management solutions to their actual payment flows, cash flow requirements, and business model.
Important Risk Information. The risks associated with FX hedging arise primarily from future market developments and the obligation to settle the transaction on the agreed terms. Before entering into a Window FX Forward, we will explain the product in detail, including how it works and the potential risks involved.
Not sure which type of forward contract is right for your business?
Leave us your contact details or speak directly with one of our specialists.
During a short consultation, we will assess whether a Standard FX Forward,
an Amortising FX Forward (AF), or another FX hedging solution is the most
suitable option for your business.
Tel.: 234 092 020
email: jiri.rys@citfin.cz
FAQ – Frequently Asked Questions
What Is a Window FX Forward and How Does It Work?
A Window FX Forward is a foreign exchange hedging solution that allows businesses to lock in an exchange rate in advance and execute the currency conversion on any day within a predefined period. Compared with a Standard FX Forward, it provides greater flexibility while still protecting the company from adverse exchange rate movements.
Standardní měnový Forward je určen firmám, které znají přesné datum budoucí platby nebo inkasa. Měnový Forward s oknem je vhodný v situaci, kdy firma zná pouze přibližný termín a potřebuje možnost vypořádat obchod kdykoliv během sjednaného období. Díky tomu získává větší flexibilitu při řízení zahraničních plateb.
A Window FX Forward is commonly used by exporters and importers that trade internationally but cannot accurately predict the exact date of a future payment or incoming receipt. Typical examples include businesses whose cash flows depend on delivery schedules, logistics arrangements, or approval processes on the customer or supplier side.
The key advantage is the combination of exchange rate protection and settlement flexibility. Businesses gain certainty over their future exchange rate, improve cash flow planning, protect profit margins, and avoid being tied to a single settlement date.
The most commonly hedged currencies include EUR, USD, GBP, PLN, and HUF. However, Window FX Forwards can be arranged for a wide range of other currencies as well. Available options depend on the currency pair and the specific requirements of the client.
For companies that regularly make or receive international payments, FX hedging can be an important tool for protecting profitability. Even relatively small exchange rate movements can have a significant impact on costs or revenues when transaction volumes are substantial. A Window FX Forward helps reduce uncertainty and provides greater predictability for future cash flows.
The right solution depends on several factors, including whether you know the exact date of a future payment, require settlement flexibility, or manage recurring foreign currency transactions. An FX specialist can assess your business needs and recommend the most appropriate solution, whether that is a Standard FX Forward, a Window FX Forward, an Amortising FX Forward, or another hedging instrument.
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