Foreign exchange forward contract and Private placement: Difference between pages

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imported>Doug Williamson
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A transaction which solely involves the exchange of two different currencies:
This is a form of securities issuance that has no exact definition. 


<p>(i) on a specific future date
It usually refers to an issue that has been designed for a specific set of investor needs at a particular time. 


(ii) at a fixed foreign exchange rate which is pre-agreed at the outset of the contract.</p>
As such it is not expected to be traded in the secondary market and is not a 'public' issue.


Foreign exchange forward contracts are used - among other purposes - for hedging forward foreign exchange exposures.
It is not normally expected to be listed on an exchange.
For example known or likely future currency receivables and payables.


They are priced by adjusting the spot foreign exchange rate to reflect the interest rate differential between the two currencies involved for the forward period.
A wide variety of securities under various names are private placements. In Germany, [[Schuldschein]] are a form of private placements, for example.




Also known as a Forward foreign exchange contract, or a Foreign exchange forward.
== See also ==
* [[Issue]]
* [[Placement]]
* [[Rule 144A]]
* [[Secondary market]]
* [[Security]]


== See also ==
 
* [[Hedging]]
== ACT Website links ==
* [[Non-deliverable forward]]
 
* [[Synthetic]]
[http://www.treasurers.org/blogs/ceo/201307 Hot money just got hotter...then evaporated, Colin Tyler, 5 July 2013]
 
[http://www.treasurers.org/node/8624 Developing a UK Private Placement market – report of the PP15+ working group]

Revision as of 14:37, 1 October 2013

This is a form of securities issuance that has no exact definition.

It usually refers to an issue that has been designed for a specific set of investor needs at a particular time.

As such it is not expected to be traded in the secondary market and is not a 'public' issue.

It is not normally expected to be listed on an exchange.

A wide variety of securities under various names are private placements. In Germany, Schuldschein are a form of private placements, for example.


See also


ACT Website links

Hot money just got hotter...then evaporated, Colin Tyler, 5 July 2013

Developing a UK Private Placement market – report of the PP15+ working group

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