forward contract in forex

This topic has 4 replies, 2 voices, and was last updated 3 years ago by John Moffat.

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- July 3, 2017 at 8:45 am #394580
  
  Vipin
  Member
  
  I was watching the forward contract in forex module in opentuition. chapter 18.
  You were finding the forward rate.
  forward rate —1.5264-1.5334
  
  sell us$ 150k
  calculation shown is
  150k/1.5334
  
  Previous lectures you were doing with 150k/1.5264 but the above case you did 150k/1.5334.
  
  Did I miss something?
- July 3, 2017 at 8:54 am #394583
  
  John Moffat
  Keymaster
  
  Since we are receiving dollars we divide by the higher rate. Only if we had we been paying dollars would we have divided by the lower rate.
- July 3, 2017 at 9:15 am #394588
  
  Vipin
  Member
  
  when we receive dollars, we pay dollars to bank for converting to pound. right? the topic is little confusing one.
- July 3, 2017 at 9:45 am #394590
  
  Vipin
  Member
  
  Ok, I got it. thanks. I watched the previous lecture again.
- July 3, 2017 at 4:55 pm #394635
  
  John Moffat
  Keymaster
  
  You are welcome 🙂
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