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Economics/spot and forward exchange rates
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Question
hello.
what is difference between spot and forward exchange rates?
COMMENTS
I extend my good will and greetings for having selected me to answer this question.
However, answer to this simple market question is available in plenty and in elaborate details in the internet by searching “Exchange rate spot” and “Exchange rate forward”. This does not need an expert from “All expert” to get an answer.
SAMPLE REPRODUCTION
From : http://www.exchange-currency.co.uk/foreign-exchange.htm
A Spot Contract is the most common type of foreign currency contract. It is the real time currency price at any given time. The price is fixed although it takes two days for settlement. On receipt of cleared funds (usually BACS, CHAPS or using online Banking) the currency is then ready for immediate delivery (usually by Electronic Fund Transfer).
Fixed Term Forward Contract.
A Fixed Term Forward Contract can give the purchaser peace of mind and the ability to budget costs more effectively. A Fixed Term Forward Contract gives the facility to fix an exchange rate at the current market exchange rate. The delivery of the currency is then fixed for a date in the future, depending on the applicable interest rates the exchange rate may vary from the 'spot' exchange rate.
The rate is guaranteed irrespective of the fluctuations in the currency markets. A deposit is required to secure the forward contract and is usually payable within two working days. The final payment is paid in time to be cleared before the maturity of the contract. If you do not need the currency immediately brokers can hold it on account until required. Competitive foreign Exchange Rates can be fixed up for up as much as two years in advance (Full terms available from the Foreign Exchange dealer).
A Fixed Term Forward Contract or forward rate helps you effectively budget for your foreign payments as you know the exchange rate is fixed. It also helps you hedge against any fluctuations in the currency markets.
Etc………
With Regards.
DR.VSRS (Website : http://www.drvsrs.com)
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Dr.VSR.Subramaniam
Expertise
Basically a B.Sc (Physics) from the University of Madras, India. Started the career in production engineering under German and Italian experts. MBA in Management from IIM, Ahmedabad (India). Ph.D (Management) from the University of Bomaby (the first ever awarded in this subject). Headed the computer centres of Multi nationals; "Data Processing expert" of the Commonwealth, London (To implement World Bank and UNDP Computer softwares); "Consultant Adviser" to the Caribbean Development Bank (CDB), Barbados. Associated with Nobel Laureate in Economic Science-1979, Arthur Lewis (Past President of CDB) & 4 more on his introduction. Visiting professor to many universities. A Trained ISO 9001:2000 Quality Auditor. Over 40 years of combined experience in Accounts, Computer Software, Economics, Engineering, Management, Science, Technology, Research & Development and Qulaity systems. Author of over 60 Application Research papers. Currently a free-lance consultant in ISO Quality Systems, Socio-Economic development acceleration, Innovative software designs. Can answer any question in Theoritical/Applied-economics with an in-depth and innovative dimension. I DO NOT ANSWER : 1. STATISTICAL data & analysis. 2. PRIVATE questions, as they do not appear for PUBLIC view & search 3. Examination & Project report oriented questions. Website http://www.drvsrs.com
Experience
Experience in the area Over 40 years in Industrial, Service and Economic development sectors. Socio-economic development oriented expertise (1982-86). With Commonwealth Fund for Technical Cooperation, London as a "Data Processing Expert". With Caribbean Development Bank, Barbados (UNDP,World bank set up) as a "Cnsultant Adviser". See "http://www.drvsrs.com/drvsrs.htm" and "http://www.drvsrs.com/publication.htm". National & International awards. R & D Author at http://ideas.repec.org/e/psu50.html and http://www.ssrn.com/author=360079
Organizations
Intellectual Consultants. A proprietory Research and Development unit under the theme "Innovation. Information & New Concepts"
Publications
See at http://www.drvsrs.com/publication.htm & http://dvsrs.com/store/page2.html
Education/Credentials
See full details at http://www.drvsrs.com/drvsrs.htm
(1) D.Litt in Computer Science - 1983. World University, USA. (2) Ph.D - 1975. First management doctorate awarded by the University of Bombay, India, after the inception of the subject. (3) MBA – 1966. IIM, Ahmedabad. India. First batch. 4) B.Sc - 1959. Physics. University of Madras, India
Awards and Honors
Biography is listed in International Who is Who of Intellectuals (UK), Men of Achievement ( UK ), Men of Distinguished Contributions (USA). National and International awards and Citations.
Past/Present Clients
See at http://www.drvsrs.com/software.htm
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