TRADING GLOSSARY
Forward contract
A forward contract is an agreement between two parties to buy or sell an asset at an agreed price on a future date. It is usually traded over the counter with customised terms and carries the risk that the other party fails to meet its obligations.
EXAMPLE
In a hypothetical agreement, a business arranges to buy EUR 10,000 for USD 11,000 in three months, fixing a rate of USD 1.10 per euro.
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Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Glossary definitions are general education only and are not investment advice. Risk disclosure