Forward rate agreement


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Forward rate agreement (FRA)

Agreement to borrow or lend at a specified future date at an interest rate that is fixed today.

Forward Rate Agreement

An agreement between two parties to exchange two currencies or interest rates at a given rate at some point in the future. A forward rate agreement mitigates foreign exchange risk or interest rate risk for the parties. It is most useful when both parties have operations or some other interest in a country using a given currency or investment vehicle with a floating interest rate. Forward rate agreements are over-the-counter contracts and are also called future rate agreements.
References in periodicals archive ?
Market participants scaled back expectations for an end to the Bank of Japan's accommodative monetary policy, with forward rate agreements suggesting expectations for virtually no change in policy through the end of 1997.
Building a knowledge base for forward rate agreements
This latest investment in CFD processing functionality follows the recently-announced addition of FX forwards, non-deliverable forwards (NDFs) and forward rate agreements (FRAs) to Gloss, and forms part of a substantial investment programme that includes the continued broadening of the Gloss solution's instrument coverage.
In contrast, turnover for foreign exchange swaps increased again, rising by 12%, while turnover for forward rate agreements rose by 4%.
This includes post-execution transaction processing for FX forwards, non-deliverable forwards (NDFs) and forward rate agreements (FRAs).
Product types include caps/floors, forward rate agreements, options, swaps, swaptions, and cross currency swaps.
Part VI Forward Rate Agreements and Forward/Forward Agreements 1.
The IR TRR holds summary transaction-level information for the full range of non-cleared OTC derivative interest rate transactions, including caps/floors, forward rate agreements, options, swaps, swaptions, and cross currency swaps.
Offers advanced pricing and analytic capabilities including Greeks and support for: IR swaps and swaptions, IR caps and floors, Forward rate agreements.
The new curves are constructed with either a combination of the domicile country's cash rate data and Forward Rate Agreements or cash rates and futures data, which is part of a continual effort to reflect current market conventions in valuation methodologies.
He briefly describes the underlying mechanics of the LIBOR cash market, Forward Rate Agreements (FRAs), and how Eurodollar futures are used to manage the supply and demand of future lending and borrowing expectations.

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