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Which of the following is a customized contract between two parties to buy or sell assets on a specified price on a future date?

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Which of the following is a customized contract between two parties to buy or sell assets on a specified price on a future date?
1). Post date agreement
2). New trading
3). Forward contract
4). Insider trading


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Answered by on | Votes 0 |
  • A forward contract is a customized contract between two parties to buy or sell assets on a specified price on a future date.
  • Suppose a farmer has 10 hectares of land planted with wheat, he is concerned about the decline in production of wheat. He, therefore, enters into a contract with a financial institution to sell the total productivity of 10 hectares of land at ?1,00,000 after 6 months. This agreement is termed as a Forward contract.

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