Forward Margin

Summary of Forward Margin

In foreign exchange transactions, the difference between the current, or “spot,”price for a given currency and the price at some future date. If the “futures”price, that quoted by sellers of contracts for future purchase of that currency, is higher than the spot price, the subject currency is said to be trading at a “premium”; if the futures price is less than the spot price, however, the currency is trading at a “discount.”

(Main Author: William J. Miller)