DEFINITION of 'Forward Delivery'

A delivery of the underlying asset at the date agreed upon in a forward contract. At the forward delivery, one party will supply the underlying asset and one will buy the asset. The terms and price of the asset was the one agreed upon at the onset of the contract or trade date.

BREAKING DOWN 'Forward Delivery'

The contract must include the security to be sold, the price at which it is to be sold, the date the payment is to be received and include any other terms of the trade. Forward contracts are normally used to hedge the party from negative price fluctuations in the underlying asset.

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RELATED FAQS
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