Categorize Currency Contract For Free

A currency forward is a customized, written contract between two parties that sets a fixed foreign currency exchange rate for a transaction, set for a specified future date. Currency forward contracts are used to hedge foreign currency exchange risk.

A forward contract allows you to buy or sell an asset on a specified future date. To account for one, start by crediting the Asset Obligation for the current value of the good on the liability side of the equation. Then, on the asset side, debit the Asset Receivable for the forward rate, or future value of the good.

Currency Derivatives are futures and options contract where you can buy or sell specific quantities of a particular currency pair at a pre-determined future date. Currency Derivative Trading is similar to Stock Futures and Options trading.

Futures or FX futures for short, are a type of futures contract to exchange a currency for another at a fixed exchange rate on a specific date in the future. Since the value of the contract is based on the underlying currency exchange rate, currency futures are considered a financial derivative.

Currency derivatives are contracts that derive their value from their underlying asset, the currency.Currency derivatives help protect against price volatility of the underlying asset in the future and are widely used by traders as a risk management financial instrument.

Currency Contract means any futures contract or option thereon providing for the delivery or receipt at a future date of a specified amount of a traded currency at a specified price and delivery point, or any other futures contract or option thereon approved for trading for U.S. persons.

FX forward valuation algorithmcalculate forward exchange rate in euros: Forward in dollars=spot+Forwardpoints/10000 , Forward in Euros=1/ForwardInDollars.caclulate net value of transaction at maturity: NetValue=Nominal(Forward-Strike)More items...?Sep 18, 2013