Short Date Forward

DEFINITION of 'Short Date Forward'

A forward exchange contract involving two parties that agree upon a set price to sell/buy an asset at a dated time in the future. A short date forward involves trading a currency at a specified spot date that is before the normal spot date.

BREAKING DOWN 'Short Date Forward'

Investors can use short date forward contracts to hedge risks or as a speculative investment vehicle. The matured value of a forward contract can be calculated by the difference between the delivery price and the underlying price of the security on that date.

RELATED TERMS
  1. Long Dated Forward

    A type of forward contract commonly used in foreign currency ...
  2. Spot Date

    The day when a spot transaction is typically settled, meaning ...
  3. Forward Exchange Contract

    A special type of foreign currency transaction. Forward contracts ...
  4. Dated Date

    The date at which interest begins to accrue on a fixed-income ...
  5. Outright Forward

    A forward currency contract with a locked-in exchange rate and ...
  6. Payment Date

    The date on which a declared stock dividend is scheduled to be ...
Related Articles
  1. Term

    The Difference Between Forwards and Futures

    Both forward and futures contracts allow investors to buy or sell an asset at a specific time and price.
  2. Trading Strategies

    Introduction To Dividends: Dividend Dates

    A corporation's Board of Directors must declare all dividends. Four dividend-related dates are important to this process: Declaration DateThe declaration date is the date that the dividend ...
  3. Economics

    What's a Maturity Date?

    Maturity date is the final date when any remaining principal and any unpaid interest are due on a debt.
  4. Investing Basics

    What is a Forward Contract?

    A forward contract is a customized contract between two parties to buy or sell an asset at a specified price on a future date.
  5. Investing Basics

    Explaining the Spot Rate

    The spot rate is the immediate purchase price posted on exchanges for purchasing commodities, currency and securities.
  6. Options & Futures

    Why Forward Contracts Are The Foundation Of All Derivatives

    This article expands on the complex structure of derivatives by explaining how an investor can assess interest rate parity and implement covered interest arbitrage by using a currency forward ...
  7. Forex Education

    Forex Tutorial: What is Forex Trading?

    What Is Forex?The foreign exchange market is the "place" where currencies are traded. Currencies are important to most people around the world, whether they realize it or not, because currencies ...
  8. Financial Advisors

    Target Date Funds Can Be Customized: Here's How

    Target date funds will likely become a permanent fixture in the marketplace for the retirement plan sector. Here's how they have recently improved.
  9. Mutual Funds & ETFs

    3 Strategies to Mitigate Currency Risk (EUFX)

    Discover the often overlooked risk known as currency risk, and learn three strategies to mitigate or eliminate it in your portfolio.
  10. Forex

    How Currency Forward Contracts Work

    A currency forward contract locks the exchange rate for a currency’s purchase or sale at a future date.
RELATED FAQS
  1. What is the difference between a forward rate and a spot rate?

    Learn about spot and forward contracts, how spot and forward rates are used for spot and forward contracts, and the difference ... Read Answer >>
  2. Over what time period should I be looking at the forward rate?

    Read about forward rates and forward prices, how they function, and which rates you should look at based on your own investment ... Read Answer >>
  3. If a company moves its dividend record date forward, does the ex-dividend date change ...

    When a dividend is declared, there are three important dates for investors: the dividend payable date, the dividend date ... Read Answer >>
  4. What is a forward contract against an export?

    Understand forward exchange contracts in exporting, and learn the purpose of using a forward contract and its advantages ... Read Answer >>
  5. The "effective date" is defined as:

    A. The date a security's registration statement is granted an effective date lasting for one year. B. The date the first ... Read Answer >>
  6. How are forward contracts regulated in the United States?

    Read about the risks of forward contracts and why they are not readily subject to regulation, including what happens when ... Read Answer >>
Hot Definitions
  1. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  2. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  3. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  4. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  5. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center