Non-Deliverable Forward

Essay specific features

 

Issue:

Miscellaneous

 

Written by:

Harry W

 

Date added:

August 5, 2015

 

Level:

University

 

Grade:

B

 

No of pages / words:

2 / 494

 

Was viewed:

7789 times

 

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Essay content:

Apart from the standard tenors (1, 2 and 3 months) banks also offer odd-dated NDFs. NDFs are typically quoted with the USD as the reference currency, and the settlement amount is also in USD. Structure and features An NDF is a short-term, cash-settled currency forward between two counterparties. On the contracted settlement date, the profit or loss is adjusted between the two counterparties based on the difference between the contracted NDF rate and the prevailing spot FX rates on an agreed notional amount...
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On the contracted settlement date, the profit or loss is adjusted between the two counterparties based on the difference between the contracted NDF rate and the prevailing spot FX rates on an agreed notional amount. The features of an NDF include: the notional amount: This is the "face value" of the NDF, which is agreed between the two counterparties...
displayed 300 characters

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