Forex Trading Instruments

Custom Search

Spot market: The most popular of the Forex trading instruments, the spot market deals exclusively with the current price of a financial instrument. A spot deal consists of a bilateral contract based on an agreed exchange rate to be delivered within two business days. The spot market is characterized by a large degree of liquidity and currency fluctuation.
Forward market: Forward trades involve future currency exchanges at a predetermined rate, based on the interest rate differential between the two relevant currencies.