--%>

Operation of currency forward and futures market

Describe basic differences between operation of a currency forward market and a futures market.

E

Expert

Verified

Forward market is an OTC market where forward contract for the sale or purchase of foreign currency is tailor-made between the client and its international bank.  No money changes hands up till the maturity date of the contract when the delivery and receipt are generally made.  A futures contract is an exchange-traded instrument with the standardized attributes stating the contract size and the delivery date.  Futures contracts are marked-to-market daily in order to reflect the changes in settlement price.  Delivery is made sometimes in the futures market.  Instead a reversing trade is made to close out a short or long position.

   Related Questions in Financial Accounting

  • Q : Essay-People Dependent on technology

    PEOPLE DEPENDENT ON TECHNOLOGY TOO MUCH: Science has developed tremendously in past few years and with the development of science many technologies have entered this world. Today everything is being done with the h

  • Q : Money how much money do i have to earn

    how much money do i have to earn monthly?

  • Q : Multiplicity-Creativity as process

    Define the term Multiplicity (Creativity as process) in creative industry ? And also state the different personality traits and intellectual aptitudes which might contribute to creative thinking ?

  • Q : Interest rate parity for determination

    Describe the allegations of interest rate parity for the determination of the exchange rate.

  • Q : Architectural Symbolism-house-style

    Wriet a report on the term Architectural Symbolism:a study of house-style meanings ?

  • Q : Social issues & person statuses Think

    Think of person you will who often irritates you or whose behaviour greats on your nerves. First list that person statuses and role then analysed his or her possible role expectations, role performance, role conflict and role strai

  • Q : Define sale Define the meaning of sale

    Define the meaning of sale in Accountancy?

  • Q : Cash flows from operating activities A

    A financial analysis tools that measures the need for financing. The formula is the cash-flow from operating activities divided by the cash paid for long-term asset. Cash paid for long-term assets can be found on the statement of cash-flow, in the investing-activities

  • Q : Problem on National income Providing

    Providing reasons, describe the treatment assigned to the following which estimates national income.(i) Family members working freely on farm owned by family.(ii) The Payment of interest on borrowings through general government.

  • Q : Calculate the PV You expect the price

    You expect the price of the stock 3 years from now to be $119.04 (i.e., you expect P ˆ   3  ?? = $119.04). Discounted at a 10% rate, what is the present value of this expected future stock price? In other words, calculate the PV of $119.04.&nb