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Definition: A futures contract is a contract between two parties where both parties agree to buy and sell a particular asset of specific quantity and at a predetermined price, at a specified date in future. Description: The payment and delivery of the asset is made on the future date termed as delivery date.

Currency of the Contract means the currency in which the Contract Price is expressed.

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.

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 futures are futures contracts for currencies that specify the price of exchanging one currency for another at a future date. The rate for currency futures contracts is derived from spot rates of the currency pair. Currency futures are used to hedge the risk of receiving payments in a foreign currency.

With FX Forwards, the main threat is credit risk. As the transaction does not undergo immediate settlement (as with spot market transactions), there is the risk of default.

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.