Definition of forward contract in English:

forward contract


  • An informal agreement traded through a broker-dealer network to buy and sell specified assets, typically currency, at a specified price at a certain future date.

    • ‘Risk tools include forward contracts, minimum price contracts, futures, options, crop insurance, hail insurance and other risk management tools.’
    • ‘Such options include weather insurance and buying energy futures, derivatives or forward contracts that require an organization to take title to, or else sell, blocks of energy.’
    • ‘For the previous 15 years, with only a few exceptions, five-month forward contracts traded in a narrow range around $20 per barrel.’
    • ‘Most market participants are now familiar with standard derivative contracts used in hedging risk, such as forward contracts, futures and listed options.’
    • ‘For foreign currency forward contracts, it's straightforward.’