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Is a binding obligation to buy or sell a certain amount of foreign currency at the current market rate, for settlement in two working days time.
Companies who have foreign currency exposure may use a spot deal. Companies exposed to transactional risk also could use this product.
Contract can be done in any currency where there is liquidity in the market. |
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A binding obligation to buy or sell a certain sum of foreign currency at a pre agreed rate of exchange, on or before a future date. The forward price for a currency can be identical with the spot price. However the forward price in practice is either higher (premium) or lower (discount) than the spot price.
The client could cover or hedge a foreign exchange exposure from future adverse fluctuations. Further, the purpose of doing a Forward Exchange Contract can be for commercial reasons, to avoid risk exposure, covering a mismatch of cash , Arbitrage and speculative.
All forward dates are set, based on the spot trading date for the currency pair involved. |
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A contract between the bank and the customer where bank borrows money from the customer against a Government Security such as Treasury Bills / Bonds. The rate of Repo is determined by the prevailing market rates. |
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Contract to sell and subsequently repurchase securities (T/ Bills, T/ Bonds) at a specific date and a price. |
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Treasury Bills are short term debt instruments issued by the Central Bank of Sri – Lanka on behalf of the Sri – Lanka Government with fixed interest rates and maturity periods of 3, 6 and 12 months. Treasury Bills can be traded in secondary market to create a capital gain. Interest of the Treasury Bills is paid at maturity and they are sold at a discount of the par value to create a positive yield to maturity. |
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Treasury Bonds are long term debt instruments issued by the Central Bank of Sri Lanka on behalf of the Sri Lanka Government with fixed rates and maturity periods from 2 to 20 years. Interest payments are made every 6 months and the face value is repaid on the maturity date. |
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