Currency Forward

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Currency Forward

An agreement between two parties to exchange a certain amount in currencies at a certain rate at a certain time. When a forward contract of any sort is made, terms are negotiated directly between the parties, unlike a futures contract, which trades on an exchange. Partly because there is little secondary market for forward contract, determining the forward price is a zero-sum game: one party will gain on the contract and one will lose. Thus, in a currency forward, each party believes that the prevailing exchange rate will move in a direction favorable to him/her by the expiry of the contract.
References in periodicals archive ?
The fair value of a foreign currency forward contract will be affected by changes in the exchange rate, and the fair value of a put option for an available-for-sale security will be affected by changes in the fair value of the underlying security.
For example, assume a taxpayer undertakes to purchase a piece of equipment to be used in its trade or business and simultaneously enters into a foreign currency forward contract (because the contract price was denominated in a foreign currency) to "fix" the price of the equipment in U.
For certain foreign currency derivatives, such as a foreign currency forward contract, Sec.
The impact of the sale of equity investment in MIBRAG includes the loss on settlement of our foreign currency forward contract of $27.
Constellation had previously entered into a foreign currency forward contract in connection with the acquisition of Vincor to fix the U.
Caroline Rook, Chief Financial Officer, commented, "The realized portion of our foreign currency forward contract gain, or actual cash generated, was $4.
42 per share and a first-quarter currency forward contract gain of $.
A currency forward contract, unlike an exchange-traded futures contract, can only be offset prior to maturity by agreement of both parties to the contract.
54 per share of restructuring charges, IPR&D and the currency forward contract gain, 2004 full-year earnings are projected to be in the range of $2.