Forward agreement is a commonly used term in the financial industry, and it refers to a contract between two parties to exchange an asset or currency at a predetermined price on a specific date in the future. This concept is widely used in foreign exchange trading, commodities trading, and stock markets.

In Hindi, forward agreement is known as ”फॉरवर्ड समझौता,” and it is usually used in the context of currency trading. In this type of agreement, two parties agree to buy or sell a currency at a fixed price at a future date. The price of a forward agreement is determined by the prevailing market rate for the currency at the time of the agreement.

Forward agreements are used by traders and businesses to hedge against future price fluctuations. By entering into a forward agreement, businesses can protect themselves against the risk of unfavorable currency exchange rates. For example, if a business knows that it will need to pay for imported goods in six months` time, it can enter into a forward agreement to buy the foreign currency required to pay for the goods at a fixed price.

Another advantage of forward agreements is that they can provide certainty and stability for businesses. By knowing the exact price they will pay or receive for an asset or currency, businesses can plan their budgets more effectively.

However, it`s important to note that forward agreements are not without their risks. If the market rate for the currency or asset changes significantly before the agreed-upon date, one party may end up with a significant loss or gain that was not anticipated.

In conclusion, forward agreement is an essential concept in the financial industry, and it`s crucial for businesses and traders to understand how it works. In Hindi, it`s known as ”फॉरवर्ड समझौता,” and it`s commonly used in the context of currency trading. By entering into a forward agreement, businesses can protect themselves against future price fluctuations and plan their budgets more effectively.