Move Currency Contract For Free

Currency Contracts means any forward contracts, futures contracts, foreign exchange contracts, currency swap agreements, and other similar agreements and arrangements designed to protect against fluctuations in foreign exchange rates.

Currency futures contracts are the same as ordinary futures contracts, but what is exchanged is specifically two currencies. One party will agree to buy a certain amount of another currency at a set price at a specified time in the future.

The U.S. dollar, the euro, the British pound, the Japanese yen, and the Indian rupee are all examples of fiat money. Because it's a currency that is backed by an issuing government, fiat money usually provides some economic stability?but not always.

The exporter in France and the importer in the US agree upon an exchange rate of 1.30 US dollars for 1 euro that will govern the transaction that is to take place six months from the date the currency forward contract is made between them.

A currency swap is an agreement in which two parties exchange the principal amount of a loan and the interest in one currency for the principal and interest in another currency. At the inception of the swap, the equivalent principal amounts are exchanged at the spot rate.

A simple example of a Currency Option is called a Vanilla Option. This gives you the choice of whether or not to sell one currency and buy another at a specified exchange rate (the protection rate) on a date in the future (the expiry date).

Currency Contract means any futures contract or option thereon providing for the delivery or receipt at a future date of a specified amount of a traded currency at a specified price and delivery point, or any other futures contract or option thereon approved for trading for U.S. persons.

Select a date in the future that you want the forward to settle (this can be up to 24 months). Request a quote ? your broker will then give you a forward price (this will be based on the interest rates of the two currencies you are exchanging. If the quote is acceptable, agree to the deal.