Forwards. Transactions in forwards involve the obligation to make, or to take, delivery of the underlying asset of the contract at a future date, or in some cases to settle your position in cash without delivery of the underlying asset. The seller of a forward contract must deliver the agreed price which can be considerably below the then market price in the case of rising prices. The purchaser of a forward contract on the other hand must accept delivery at the agreed price in the case of falling prices. In both cases, the risk lies in the difference between the agreed price and the market price. This risk is not determinable in advance and can exceed any collateral provided.
Appears in 5 contracts
Samples: Client Agreement for Foreign, Client Agreement for Foreign Exchange, Client Agreement for Foreign
