Definition of Forward contract:
Binding contract under which a commodity or financial instrument is bought or sold at the market price (spot price) as on today (date of making the contract), but is to be delivered on a stated future (forward) date in settlement of the contract. In contrast, a futures contract is only a formal promise. Also called cash contract, cash forward contract, or cash forward sale.
An informal agreement traded through a broker-dealer network to buy and sell specified assets, typically currency, at a specified price at a certain future date.
How to use Forward contract in a sentence?
- You should always follow everything that is in a forward contract because if you dont it may be able to be voided.
- Risk tools include forward contracts, minimum price contracts, futures, options, crop insurance, hail insurance and other risk management tools.
- The forward contract was what interested me because I did not know exactly what it meant for us, or the buyer.
- You should always do everything you say you will do when you sign a forward contract to ensure that the other person sticks to their end.
Meaning of Forward contract & Forward contract Definition