What are Forward Margins?


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Forward Margins :
Forward Margins can be classified as either PREMIUMS or DISCOUNTS. When the
interest rate of the variable currency is more than the interest rate of the base currency,
the forward margin is added to the spot rate to arrive at the forward rate.

Such margins are called PREMIUMS on base currency. When the interest rate of the
variable currency is less than the interest rate of the base currency, the forward margin is
subtracted from the spot rate to arrive at the forward rate. Such margins are called
DISCOUNTS on base currency.


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MT UVA BMS

MT UVA- University, Vocational and Affiliated Education for BMS

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