Non-Deliverable Forward


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Non-Deliverable Forward

A forward contract on a low-volume or inconvertible currency that cannot be settled by delivery of the underlying. In a non-deliverable forward, the parties net the difference between the exchange rate listed in the contract and the spot rate, and one party pays the other that difference. They are usually settled in U.S. dollars. Multinational corporations sometimes use non-deliverable forwards to hedge against risk associated with comparatively illiquid currencies.
References in periodicals archive ?
Wang Kai-Li, Fawson Christopher and Chen Mei-Ling (2007), "Information Flows among Exchange Rate Markets: What Do We Learn From Non-Deliverable Forward Markets in Asia?
Non-deliverable forwards are used to hedge or speculate against currencies when exchange controls make it difficult for foreigners to trade in the spot market directly.
A non-deliverable forward is an FX Forward for which the physical exchange of currency at expiry is replaced by settlement between counterparties of the net profit / loss on the contract, calculated off the prevailing spot rate two days prior to settlement.
TT will support trading of spot FX, precious metal and non-deliverable forward (NDF) contracts through its high-speed gateway to the EBS platform.
Banks hedging of the US dollar via non-deliverable forward (NDF) contracts with global banks may stop soon, because of the recent directive of the Nepal Rastra Bank (NRB).
One-year non-deliverable forward contracts traded in Hong Kong continued to express expectations for future yuan depreciation, with quotes at 6.
The Conticap source will further enrich ComStock's datafeed - content received will include FX spot, forwards and swaps, local currency government bonds and non-deliverable forward foreign exchange.
Non-deliverable forward contracts with a 1-year tenor in Hong Kong traded at 6.
Offshore one-year non-deliverable forwards contracts (NDFs), considered the best available proxy for forward-looking market expectations of the yuan's value, traded at 6.
Separately, non-deliverable forwards (NDFs) are to be formally listed on Hotspots wholly-owned swap execution facility (SEF), previously called Javelin, in the coming weeks.
Foreign banks have been sent a form to sign, which asks them for an 'unconditional representation and commitment' to stop trading in any offshore Malaysian ringgit MYRNDFOR= non-deliverable forwards or offshore derivatives.
The deal is intended to accelerate Bats' plans to offer trading of non-deliverable forwards for the foreign exchange market.

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