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Forwards

Trading Term

A forward is an agreement to buy or sell a commodity or a financial asset at a specified future date for a fixed price. It is a completed contract and the commodity or financial asset will be delivered, unlike an option which gives a choice of whether or not to complete the trade at the later date. Unlike futures, forwards are not contracts with standard fixed terms. They are tailor-made between the buyer and seller for each deal and are traded OTC rather than on an exchange.

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