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Forward market

Informal financial market


Informal financial market

The forward market is the informal over-the-counter financial market by which contracts for future delivery are entered into. It is mainly used for trading in foreign currencies, where the contracts are used to hedge against foreign exchange risk. Commodities are also traded on forward markets. Examples include agricultural products such as rice, and energy futures, such as oil and natural gas. Transactions on a forward market are typically not standardized, and contracts are customised to the needs of the trading parties. In contrast, standardized forward contracts are called futures contracts and traded on a futures exchange.

References

References

  1. "Management". Arihant Publications.
  2. (2016). "Introduction to Global Business: Understanding the International Environment & Global Business Functions". [[Cengage Learning]].
  3. Julian Roche. (2014). "The International Rice Trade". [[Elsevier Science]].
  4. [[Business and Enterprise Select Committee. (2005). "Fuel Prices; Twelfth Report of Session 2004-05; Report, Together with Formal Minutes, Oral and Written Evidence". [[Office of Public Sector Information.
  5. (2009). "Risk Management in Commodity Markets; From Shipping to Agriculturals and Energy". [[Wiley (publisher).
  6. (2014). "Global Corporate Finance: A Focused Approach". [[World Scientific Publishing Company]].
  7. Alexander Davidson. (2009). "How the Global Financial Markets Really Work". [[Kogan Page]].
  8. Jeff Madura. (2015). "International Financial Management". [[Cengage Learning]].
  9. Vyuptakesh Sharan. (2008). "Fundamentals of Financial Management". [[Pearson Education]].
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