If you’re involved in trading, investing, business planning or international finance, you must know the difference between spot rates and forward rates. Understanding the difference plays a big role ...

Many corporations and some high-net-worth individuals use currency forward contracts to hedge their future or forward currency exposures to the forex market against unfavorable moves. Companies with ...

A spot rate is the current market price at which a stock, bond, commodity, or currency can be purchased or sold. A forward rate or forward price is a price set in advance between a buyer and a seller ...

Sean Ross is a strategic adviser at 1031x.com, Investopedia contributor, and the founder and manager of Free Lances Ltd. Suzanne is a content marketer, writer, and fact-checker. She holds a Bachelor ...

Calculate the one-year forward rate. For example, suppose the one-year government bond was yielding 2% and the two-year bond was yielding 4%. The one year forward rate represents the one-year interest ...