Forward forward contract: Difference between revisions
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imported>Doug Williamson (Link with Forward yield page.) |
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* [[Forward forward rate]] | * [[Forward forward rate]] | ||
* [[Forward rate agreement]] | * [[Forward rate agreement]] | ||
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Revision as of 11:49, 11 November 2015
A forward forward borrowing or deposit is a binding contract struck today, for the physical borrowing or lending of funds at a fixed future date. (At an agreed rate, for a predetermined fixed period.)
The Principal amount borrowed or lent is physically transferred between the parties, and repaid - plus the contracted amount of fixed interest - at maturity.
Not to be confused with a Forward Rate Agreement, which is a derivative contract for differences.
