Introduction
Gold forward hedge refers to that a customer and Bank of China reach a gold forward transaction (including forward gold selling and buying) in USD, but such transactions are required to be hedged via reverse transactions no later than 2 days before the maturity of the relevant forward contract, instead of physical gold delivery, also, the USD margin settlement between the two transactions should be conducted on the maturity day.
Features
1. As for the open-end products, customers can select products with different terms and quantities to meet their needs of liquidation;
2. It is convenient to operate with USD net settlement without physical gold delivery to avoid huge amount of principal delivery;
3. Customers can select profit unwinding at any time according to the market status after product transaction so as to increase the flexibility of value maintenance operation, which will not be limited by spot goods transaction.
Target customers
Gold producers and enterprises using gold
Application Qualifications
1. Clients must have USD account in Bank of China;
2. Such hedging transactions should be based on gold yield or demand in the future, without over maintenance of value;
3. No matter the relevant market price is favorable or not, it is obligated to launch the reverse unwinding.
Currency
USD
Term
Foward
Process
1. The customer apply for forward gold transaction;
2. Sign the contract for forward gold transaction;
3. Transaction authentication;
4. Customer's forward unwinding. The customer must submit relevant unwinding application according to the terms of Authentication Letter of Gold Forward Transaction on Behalf of Customers no later than two days before the maturity day.
5. Bank of China completes the unwinding transaction and the liquidation of the original forward transaction on the maturity day according to the customer's application.
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