You acknowledge that the parties to these exchange rate transactions engaged in arm’s-length negotiations.
Again, you have no interest in any profit associated with this activity and those profits are solely for our account. You should assume we have an economic incentive to be a counterparty to any transaction with you. We also may take proprietary positions in certain currencies. You will have no interest in any profits. When our pre-hedging and hedging activity is completed at prices that are superior to the agreed upon execution price or benchmark, we will keep the positive difference as a profit in connection with the transactions. You acknowledge that we bear no liability for these potential price movements. These transactions may affect the price of the underlying currency, and consequently, your cost or proceeds. These transactions will be designed to be reasonable in relation to the risks associated with the potential transaction with you. Such activities may include trading ahead of order execution. In connection with our market making and other activities, we may engage in hedging, including pre-hedging, to mitigate our risk, facilitate customer transactions and hedge any associated exposure. The level of the fee or markup may differ for each customer and may differ for the same customer depending on the method or venue used for transaction execution The price provided may include profit, fees, costs, charges or other mark ups as determined by us in our sole discretion. We provide all-in pricing for exchange rates. The exchange rate you are offered may be different from, and likely inferior to, the rate paid by us to acquire the underlying currency. Exchange rates offered by other dealers or shown at other sources by us or other dealers (including online sources) may be different from our exchange rates. You acknowledge that exchange rates for retail and commercial transactions, and for transactions effected after regular business hours and on weekends, are different from the exchange rates for large inter-bank transactions effected during the business day, as may be reported in The Wall Street Journal or elsewhere.
If we assign an exchange rate to your foreign exchange transaction, that exchange rate will be determined by us in our sole discretion based upon such factors as we determine relevant, including without limitation, market conditions, exchange rates charged by other parties, our desired rate of return, market risk, credit risk and other market, economic and business factors, and is subject to change at any time without notice. Accordingly parties to transactions that are indexed to foreign currency may use any exchange rate on which they agree.1Exchange rates fluctuate, at times significantly, and you acknowledge and accept all risks that may result from such fluctuations. Importantly, the representative rate is an indicator of the exchange rate in use but has no obligatory status under law. The representative rate is based on the rate prevailing in the market at the time it is set.
On each foreign currency business day in Israel, the Bank of Israel publishes the representative exchange rate of the shekel against foreign currencies. Section 4(3) of the Law states that one of the functions of the Bank of Israel is "Supporting the orderly activity of the Foreign Currency market in Israel." In this capacity the Markets Department monitors market performance. In the early 1990s, foreign-currency control was gradually repealed in a liberalization process. However, the Bank reserves the right to intervene in foreign currency trading when necessary. Today, the exchange rate policy is based on unrestrained fluctuation of the domestic currency against other currencies. Foreign currency trading takes place mainly between banks and their customers in Israel and abroad and among banks themselves.
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