Forward Settlement Date
The future date when a forward forex contract will settle and currencies will be exchanged.
Definition
A forward settlement date is the agreed-upon future date when a forward foreign exchange contract will be settled. Unlike spot transactions (T+2), forward contracts can settle on any agreed date in the future, from a few days to several years ahead.
How It Works
- Agreed at contract inception
- Can be any business day after spot date
- Standard tenors: 1W, 1M, 2M, 3M, 6M, 1Y
- Non-standard dates are called "broken dates"
Trading Tips
1
Forward rates include interest rate differentials
2
Longer dates typically have wider spreads
3
Match settlement date to your actual currency need
Related Terms
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