Transactions in the foreign exchange market include spot foreign exchange transactions, forward foreign exchange transactions, foreign exchange options transactions and forex futures trading.
Spot foreign exchange transaction refers to the transaction that the buyer and the seller deliver on the second working day after the transaction is completed.
Forward foreign exchange trading, also known as forward foreign exchange trading, is a business in which buyers and sellers make an appointment to buy and sell foreign exchange through commercial banks and investment banks. Compared with spot foreign exchange transactions, forward foreign exchange transactions have the advantages of maintaining value, avoiding exchange rate risks, flexible capital planning and turnover.
Foreign exchange options trading is also a kind of forward foreign exchange trading, which is different from the general forward foreign exchange trading, mainly because foreign exchange trading includes options buying and selling.
Forex futures trading and forward foreign exchange transactions refer to the payment and delivery of a certain standard amount of foreign currency at a predetermined price on a specific date in the future. But forex futures trading is different from forward foreign exchange transactions.