Foreign Exchange Market – Forex

This training course provides the key knowledge required to understand the foreign exchange market and its importance within the international financial environment.

The foreign exchange market is at the heart of the international financial system, facilitating international trade, investments and capital flows worldwide. In an environment characterised by the globalisation of economies and currency volatility, understanding the challenges and mechanisms of the foreign exchange market has become essential for finance professionals.

By the end of the course, we will be able to:

• Discover and understand how the world’s largest financial market operates, with more than USD 5 trillion traded daily.
• Understand future developments and their potential implications.
• Develop an understanding of the characteristics of the various foreign exchange transactions, ranging from cash/banknote exchange to Non-Deliverable Forwards (NDFs).

After reviewing the fundamentals and origins of foreign exchange transactions, the specific terminology, as well as the rules and market conventions, this one-day training course will introduce participants, through practical exercises, to the following:

• Spot foreign exchange transactions
• Cash/banknote exchange
• Forward foreign exchange transactions
• Non-Deliverable Forwards (NDFs)

The course will also cover the various applications of these foreign exchange transactions for:

• Corporate clients
• Institutional clients – investment funds (UCIs)
• Private clients – retail and private banking
• Interbank counterparties

HISTORICAL BACKGROUND

• A brief look at early history
• From the last third of the 19th century to 1970
• The era of market liberalisation
• European history and the Euro
• European Union enlargement
• Economic and Monetary Union

CHARACTERISTICS OF THE FOREIGN EXCHANGE MARKET

• FOREX
• Types of foreign exchange transactions
• The over-the-counter market, open 24 hours a day
• The foreign exchange market in figures
• Historical XEU/USD exchange rates
• Historical euro exchange rates against major currencies
• Factors influencing exchange rates
• FOREX market participants
• ISO currency codes

SPOT FOREIGN EXCHANGE

• Currency pairs
• Trade date and value date
• Spot versus forward transactions
• Understanding the foreign exchange calendar
• Exchange rates
• Quotation conventions
• Spread and margin
• Base currencies
• Cross rates
• Foreign exchange position and foreign exchange risk
• Settlement risk and CLS
• Foreign exchange trading practices
• Numerical example

CASH / BANKNOTE EXCHANGE

• Numerical example

FORWARD FOREIGN EXCHANGE

• Numerical example

NON-DELIVERABLE FORWARD (NDF)

• Numerical example

ACI – THE PROFESSIONAL ASSOCIATION 

The training is delivered in a blended-learning format. Participants receive access to a preparatory e-learning course five days before the classroom session.

This training is intended for financial-sector professionals wishing to gain an understanding of the mechanisms of the foreign exchange (Forex) market, its key participants and its instruments.

It is particularly suitable for professionals working in:

• Treasury
• Capital Markets
• Corporate Banking
• Private Banking
• Investment Advisory
• Risk Management
• Middle Office
• Back Office
• Securities Operations
• Finance
• Compliance

It is also relevant for anyone involved in foreign exchange transactions or wishing to strengthen their knowledge of currency markets.