“How do I know when the time is right for me to buy my overseas property in order to make the most out of my pounds?” We put the question to David Kerns, Personal Client Dealing Manager at Moneycorp…

When purchasing a holiday home or investment property overseas, timing is crucial as you are buying a large amount of foreign currency. With currency markets in constant fluctuation, trading at the right time will mean your money goes a lot further.

What can you do about it?

Planning ahead can save you significant sums of money. If you leave payments to the last minute, you will have to accept the rate that the markets offer that day, whatever that may be.

While high street banks are often the first port of call for most international property payments, foreign exchange specialists can offer homebuyers superior rates of exchange, in addition to a more comprehensive range of services that will help protect them from adverse currency movements.

A forward contract is just one of the services a currency broker can provide to clients making international money transfers. You book to buy or sell your currency in the future, at a rate you fix today. Forward contracts can help protect against adverse currency movements and can be used to lock into favourable exchange rates.

To help you get to grips with things, see below for a brief outline of the other FX tools and products that a currency specialist is likely to offer which will help you transfer your money for your overseas property at the right time.

Spot contracts
Buy or sell a currency for immediate delivery. Spot contracts are suitable if you want to receive your currency quickly and efficiently.

Stop loss orders
Set a minimum level at which you will buy/sell your currency. Your order will be fulfilled automatically if this rate is reached in the markets. Effectively, this guarantees a minimum rate at which your currency will be exchanged.

Limit orders
Set a higher target exchange rate at which you will buy/sell your currency. Your order will be fulfilled automatically if this rate is reached in the markets. Effectively, this guarantees a maximum rate at which your currency will be exchanged.

If you run a limit order in parallel with a stop loss order, the exchange rate at which you trade is guaranteed within a given range – which means you can plan ahead more effectively.

Moneycorp is the UK’s leading foreign exchange and international money transfer specialist. For expert guidance and the best exchange rates available contact Moneycorp on +44 (0)20 7589 3000 or visit the Moneycorp currency zone.