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hedge foreign currency risk

This topic has 1 reply, 2 voices, and was last updated 6 years ago by John Moffat.

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April 12, 2019 at 5:20 pm #512124
Saimon
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Risk of default is higher with forward contract compare to exchange traded contract???
Can you please explain me this line
What does it mean and the reason
April 13, 2019 at 9:20 am #512176
John Moffat
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If contracts are traded on an exchange then the contract can always be sold to someone else and money be received as a result.
However a forward contract is just contracted with one party and so there is more risk as a result.
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