Foreign Currency Forward
/ˈfɔːrən ˈkɜːrənsi ˈfɔːrwərd/
Definitions
- (n.) A contract obligating the purchase or sale of a specific amount of foreign currency at a predetermined rate on a future date, primarily used for hedging currency risk.
The company entered into a foreign currency forward to lock in the exchange rate for its overseas payment.
Forms
- foreign currency forward
- foreign currency forwards
Related terms
See also
Commentary
Foreign currency forwards are distinct from futures as they are typically over-the-counter contracts customized between parties without standardization.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.