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Forward Price

   Also found in: Wikipedia 0.01 sec.
Forward Price
The agreed upon price of the underlying asset in a forward contract. When a forward contract is made, the parties agree to buy/sell the underlying at a certain point in the future at a certain price. The price is negotiated directly between the parties, unlike a futures contract, which trades on an exchange. Partly because there is little secondary market for forward contracts, determining the forward price is a zero-sum game: one party will gain on the contract and one will lose.


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This year, however, the tables have turned, current commodity prices are poor and the forward prices do not look much better.
EasyJet said forward prices for fuel had risen from 840 US dollars a tonne to 1000 US dollars per tonne since February 7.
One party agrees to buy, the other to sell, for a forward price agreed in advance.
 
 
 
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