Greneery

Bismillah and assalamualaikum. May this super simple explanation help your understanding on the practice of forward forex in Islamic finance. Wide smilesss! :D :D :D  Your duit raya in advance! ^,^ *** Islamic financial derivative instruments such as swaps, forwards and options have been introduced in Islamic finance as one of the hedging mechanisms to enhance risk management capability of market participants. A forward contract is a customized contract between two parties to buy or sell an asset at a specified price on a future date. It can be both for hedging and speculation. While foreign exchange is the exchange of one currency for another or the conversion of one currency into another currency. The term foreign exchange is usually abbreviated as "forex" and occasionally as "FX”. Thus in short, forward forign currency exchange is the exchange of one currency for another at a specified price on a future date agreed by both contracting parties.