Forex

What is Offshore Currency

Offshore currencies are employed by countries to enable Forex trading of their currencies,  keeping control over the capital flow through its geographical boundaries at the same time.  In some cases there are foreign exchange or banking regulations which require onshore capital controls, hence the same currency is traded offshore with Read more…

Derivatives

What are Futures

A futures contract is essentially a standardised forward contract, except that the deal is made through an organised and regulated exchange rather than being negotiated directly between two parties. These exchanges specify certain features to standardise the product, and also provides the guarantee that the contract will be honoured. Based Read more…

Derivatives

What are Forwards

A forward contract is made directly between two parties. In a physically delivered forward contract one party agrees to buy an underlying commodity or financial asset on a future date at an agreed fixed price. The other party agrees to deliver that item at the stipulated price. Both sides are Read more…

Derivatives

What are Swaps

A swap is an agreement made between two parties to exchange payments on regular future dates, where each payment leg is calculated on a different basis. For example, suppose that a US company has to make interest payments on a euro loan over the next five years. Unfortunately its income Read more…

Bonds

Day Count Convention In Bonds

Day-count convention is used to calculate accrued interest between coupon payments. This convention helps to determine the number of days between payment, thus helping with calculation of how interest is accrued over a period. This convention dictates how the period between payments is calculated, by deciding numbers of days in Read more…