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| A transaction which solely involves the exchange of two different currencies:
| | Insurance-linked securities |
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| (i) on a specific future date
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| (ii) at a fixed foreign exchange rate which is pre-agreed at the outset of the contract.
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| Foreign exchange forward contracts are used - among other purposes - for hedging forward foreign exchange exposures.
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| For example known or likely future currency receivables and payables.
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| 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.
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| | == See also == |
| | * [[Catastrophe bond]] |
| | * [[Insurance]] |
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| Also known as a Forward foreign exchange contract, or a Foreign exchange forward.
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| == See also ==
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| * [[Hedging]]
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| * [[Non-deliverable forward]]
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| * [[Synthetic]]
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Revision as of 14:19, 23 October 2012
Insurance-linked securities
See also
