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Forward Contracts
Forward Contracts

Forward Contracts

20
Feb

Economic Indicators Influencing Fx Rates

Foreign exchange rates are influenced by the political, economic, and financial fortunes of the markets they operate in.   In life, we fear that which we do not know. Knowing, and more importantly understanding, which direction foreign exchange rates are moving is the key to preventing the costly error of trading currencies at the wrong […]

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20
Feb

Dealing in the Spot Market

An effective forex trading strategy does not have to be limited to only forward contracts. At times, Trading foreign currency directly in the spot market, at the current spot rate, is the most effective strategy for a business to minimize its costs or maximize its profits. Sometimes, it can be more profitable to execute a […]

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20
Feb

Spot Rates vs. Forward Rates

The first step in understanding foreign currency exchanges is to have a grasp of the concept of spot rates and forward rates (also known as forward contracts), and the difference between the two. A spot rate is a currency’s foreign exchange rate at the present moment in time. It is a static price of the […]

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20
Feb

What Is a Futures Contract

Futures are contracts that give buyers the obligation to buy an asset or commodity, and the seller the obligation to sell that asset or commodity, at an agreed upon price at a future point in time. Because this agreement is binding and not simply an option to buy or sell the underlying asset, futures are […]

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20
Feb

What Is A Derivative?

A derivative is a financial contract between two or more parties, whose value is determined from the value of another underlying asset. Derivatives come in a variety of types, the two most common being futures and options. These instruments are often used to mitigate the risk that one of the parties in the contract seeks […]

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19
Feb

How to book a Drawdown from a Forward trade

In order to book a Drawdown from Forward trade, please click on the New trade button in the navigation menu:     or click on the Convert & Pay option on the dashboard:     Then select the Drawdown tab.     Select the forward transaction you would like to Drawdown from, and click Continue. […]

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19
Feb

How to book a Fixed Forward trade

In order to create a Fixed Forward, please click on the New trade button in the navigation menu:     or click on the Convert & Pay option on the dashboard:     Select the Fixed Forward tab.     Choose the currency you want to sell or buy using the currency dropdown menu. Enter […]

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13
Nov

What is a PAR Forward

What is a PAR FORWARD? A par forward is based on the same principles as a standard forward, i.e. a precisely defined amount is hedged by the fixed rate on the given date. It differs from standard forwards in that there is a possibility to make a series of multiple forwards with regular maturities. The final rate for all forwards […]

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13
Nov

What is a Swap Agreement

A swap agreement is a derivative transaction with foreign currency. This fixed negotiated trade with foreign currency is composed of two parts. The trade results in the immediate purchase or sale of funds in currency A for a specific amount of funds in currency B. The purchase or sale of the funds in currency B for a certain amount […]

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05
Nov

Long Dated Forward

What Is a Long Dated Forward? A long dated forward is a type of forward contract commonly used in foreign currency transactions with a settlement date longer than one year away and as far as 10 years. Companies use these contracts to hedge certain currency exposures.   This can be contrasted with a short dated […]

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