Okuzeka
Finance & Banking vocabulary · Treasury & Markets

Non-deliverable forward

Meaning in finance & banking, with examples

nounAdvanced term

In finance & banking, non-deliverable forward means: A currency forward settled by paying a rate difference rather than exchanging the underlying currency amounts.

In Turkish: nakdi uzlaşılı vadeli döviz sözleşmesi

How it is used

Abbreviated NDF; specify the fixing rate, notional amount and settlement currency.

Example sentences

  1. The exporter hedged the currency exposure with a non-deliverable forward.

    The contract hedges a rate without delivering both currency principals.

  2. The non-deliverable forward settled in dollars after the reference rate was fixed.

    A fixing determines the cash difference payable at settlement.

Common collocations

  • non-deliverable forward fixing
  • NDF settlement
  • forward contractAn agreement to buy or sell an amount of currency or another asset on a future date at a price fixed today.
  • foreign exchangeThe buying and selling of currencies, or foreign currency itself. It is often shortened to FX or forex.

More terms: Treasury & Markets

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This page explains English vocabulary for learners. It is not financial advice.