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In forex (fx) trading, the settlement currency (also referred to as payment currency) is the second currency listed in the currency pair description (example: EUR.USD). The transaction currency multiplied by the exchange rate will indicate the settlement currency amount for the transaction.

A spot date is the day the transaction settles as opposed to the day the trade is executed.An exception to the usual two-day spot-date guideline is the USD/CAD pair, which settles in one business day because this currency pair is commonly traded and its financial centers are in the same time zone.

Futures contracts have expiration dates as opposed to stocks that trade in perpetuity. They are rolled over to a different month to avoid the costs and obligations associated with settlement of the contracts. Futures contracts are most often settled by physical settlement or cash settlement.

Currency futures are based on the exchange rate of a currency pair. They are settled in cash in the underlying currency. For instance, the EUR futures market is based upon the euro to dollar exchange rate and has the euro as its underlying currency.

In forex (fx) trading, the settlement currency (also referred to as payment currency) is the second currency listed in the currency pair description (example: EUR.USD). The transaction currency multiplied by the exchange rate will indicate the settlement currency amount for the transaction.

Cross-currency settlement risk is a type of settlement risk in which a party involved in a foreign exchange transaction sends the currency it has sold but does not receive the currency it has bought.

Foreign exchange trades typically set- tle according to standardized settlement conventions, e.g., for spot or in two business days; for 30, 60, or 90 calendar days forward; and on the Wednesday following the third Monday of March, June, September, and December.

4feff Only a small percentage of currency futures contracts are settled in the physical delivery of foreign exchange between a buyer and seller. When a currency futures contract is held to expiration and is physically settled, the appropriate exchange and the participant each have duties to complete the delivery.

The settlement date for stocks and bonds is usually two business days after the execution date (T+2). For government securities and options, it's the next business day (T+1). In spot foreign exchange (FX), the date is two business days after the transaction date.

The settlement of Forex transactions by CCIL started from November 8, 2002. This segment accepts the inter-bank Cash, Tom, Spot and Forward USD-INR transactions for settlement through a process of multilateral netting. The multilateral netting system provides a netting benefit of well over 95%.