Forward currency contract

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Forward currency contract

An agreement to buy or sell a country's currency at a specific price, usually 30, 60, or 90 days in the future. This guarantees an exchange rate on a given date.

Forward Currency Contract

An agreement between two parties to exchange two currencies at a given exchange rate at some point in the future, usually 30, 60, or 90 days hence. A forward currency contract mitigates foreign exchange risk for the parties and is most useful when both parties have operations or some other interest in a country using a given currency. Forward currency contracts are over-the-counter contracts.
References in periodicals archive ?
Global Banking News-September 1, 2015--China wants banks to keep reserves for forward currency contracts
The Fund primarily uses short-term forward currency contracts on developed market currencies to achieve its goals.
This ruling by Bahrain-based AAOIFI has contributed to widespread opposition to the use of muwa'adah in forward currency contracts.
Regardless of whether SAA was able to eventually negotiate a deferral or other reprieve to honor such obligations in its weakened financial state, in light of its forward currency contracts, the company would have had no choice but to honor the financial commitment to purchase dollars/sell rand.
The Fund seeks enhanced income by investing in short duration (typically less than one year) emerging market forward currency contracts and other emerging market debt instruments.
Three months ending June 30, (In thousands of Canadian dollars) 2008 2007 General, administration and selling $ 6,235 $ 3,917 Coal exploration 563 799 Interest and financing fees on long-term debt 9,759 5,667 Unrealized gain on forward currency contracts - (8,028) Other income (502) (2,073) Total other expenses $ 16,055 $ 282
and foreign currencies through the use of short-term money market instruments; derivative instruments, including but not limited to, forward currency contracts, index swaps and options; and cash deposits.
The Fund seeks enhanced income by investing in short duration (typically below one year) emerging market forward currency contracts and other emerging market debt instruments.
The indices represent the performance of a rolling investment in three-month, non-deliverable, forward currency contracts.
The partial repayment of the Canadian mortgage debt will result in the related forward currency contracts hedge being deemed ineffective for accounting purposes, resulting in a decrease in net income and Adjusted EBITDA of approximately $19 million.
The company partially manages its foreign currency exposure through forward currency contracts.
This hedging is done through the purchase and sale of forward currency contracts and currency options.