forward exchange transaction

forward exchange transaction
foreign currency purchase or sale at the current exchange rate but with payment or delivery of the foreign currency at a future date. Bloomberg Financial Dictionary

Financial and business terms. 2012.

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  • forward currency transaction — A currency transaction where a rate of exchange is agreed today but delivery occurs on an agreed date in the future. The rate of exchange is known as the forward exchange rate ( forward rate). Dresdner Kleinwort Wasserstein financial glossary …   Financial and business terms

  • forward exchange — A type of foreign exchange transaction whereby a contract is made to exchange one currency for another at a fixed date in the future at a specified exchange rate. By buying or selling forward exchange, business protect themselves against a… …   Financial and business terms

  • Forward Exchange Contract — A special type of foreign currency transaction. Forward contracts are agreements between two parties to exchange two designated currencies at a specific time in the future. These contracts always take place on a date after the date that the spot… …   Investment dictionary

  • Exchange rate — Foreign exchange Exchange rates Currency band Exchange rate Exchange rate regime Exchange rate flexibility Dollarization Fixed exchange rate Floating exchange rate Linked exchange rate Managed float regime Markets Foreign exchange market Futures… …   Wikipedia

  • Forward Margin —    The discount or premium between the spot and forward rates for a forward foreign exchange transaction. It represents the interest rate differential between the two currencies traded.    ► See also Discount, Premium …   Financial and business terms

  • Forward contract — Financial markets Public market Exchange Securities Bond market Fixed income Corporate bond Government bond Municipal bond …   Wikipedia

  • Forward Booking — A way of trading currency while minimizing the risk of volatile exchange rates. The booking company (risk agents) will write up a contract specifying what the rate of exchange will be, and in doing so will assume the exchange rate risk. The… …   Investment dictionary

  • forward contract — A contract entered into by two parties who agree to the future purchase or sale of a specified commodity. This differs from a futures contract in that the participants in a forward contract are contracting directly with each other, rather than… …   Financial and business terms

  • Transaction Exposure — The risk, faced by companies involved in international trade, that currency exchange rates will change after the companies have already entered into financial obligations. Such exposure to fluctuating exchange rates can lead to major losses for… …   Investment dictionary

  • forward rate — The interest rate for a specified maturity of a fixed income security for a future date. For example, the forward rate for six month Treasury bills one month from today. See spot rate for contrast. American Banker Glossary A projection of future… …   Financial and business terms

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