Currency futures – a forward transactions with standard dimensions and timelines, which are traded on the official markets. A futures contract is an obligation to buy or sell one currency against another at an agreed exchange rate on a specified date in the future.
Currency futures trading exchanges such as the Chicago Mercantile Exchange (CME). International monetary exchange in Singapore (SIMEX) and Emergency Financial Exchange in Paris (MATIF).

Exchange-traded currency futures contracts are characterized as follows:

  • Standard specification – a unit of trade, the trade cycle in the months, the delivery date, quotation, minimum price change, etc .;
  • the ability to trade an instrument and perform offeetnye operation, that is to repay the original contract equivalent opposite transaction. Supply only over a small part of contracts (less than 3%);
  • public market – the price of the contracts are easily accessible. Trades take place in the hall of the Exchange by open outcry, the price displayed on the scoreboard at the stock exchange are published in the financial press and financial information providers such as Reuters;
  • the fact that the counterparty of both parties to the transaction is a clearing house. Buyer and seller sign a contract directly. The clearing house, thus assumes the credit risk associated with the possibility of default by one of the parties to the transaction. This means that the creditworthiness of any authorized market participant complies with the clearing house, and, consequently, larger organizations or investors do not have an advantage over small.



How is the price of the currency futures
currency futures prices are closely linked to the spot rate of the currency market, and the difference between them is determined by the difference in delivery dates. This difference is called the swap and is defined as follows:

Swap = Futures price – spot price.

The swap reflects the cost of funding the urgent position in one currency against the other during the period between the date of the transaction and the delivery depends on the interest rate differential on the two currencies. As we approach the date of delivery on a futures contract, swap the value to zero. In the end, that is, on the date of delivery, the futures price becomes equal to the spot rate.