Forex Forward Contract Value Calculator
Estimate the present quote-currency value of a normal buy-base or sell-base FX forward by comparing its original contract rate with a current replacement forward for the same remaining maturity, then applying an entered simple discount rate. This is a constrained educational approximation, not dealer closeout or accounting fair value.
Enter one existing-forward value scenario
Use quote currency per one base currency. The replacement forward must use the same remaining maturity and settlement basis as the original contract.
Entered replacement-value estimate
Entered FX Forward Planning 1.0.0
On smaller screens, scroll horizontally to inspect the audit notes.
| Audit item | Entered or derived basis |
|---|
How the FX forward value approximation works
Replacement quote amount = base amount × current same-maturity forward
Undiscounted value = direction sign × (replacement amount − contracted amount)
Present value = undiscounted value ÷ (1 + quote discount rate × days remaining ÷ day basis)
The quote convention is quote currency per one base currency. A buy-base contract has a positive direction sign because buying base at a lower contracted rate than the current replacement rate has positive arithmetic value before other adjustments. A sell-base contract reverses that sign.
The current replacement rate must be a forward rate for the same remaining maturity, settlement date, currency pair and normal quote-currency settlement basis. Comparing the contract with spot or with a different maturity mixes unlike cash flows.
The undiscounted amount is the direction-aware difference between the replacement and contracted quote-currency cash flows at maturity. The page then applies one entered simple quote-currency discount rate over the whole days remaining.
A positive value means the entered original contract rate is favorable relative to the entered replacement forward for the selected direction under this narrow method. Negative means unfavorable, and zero means the two entered rates are equal after direction before discounting.
Discounting changes magnitude, not sign, while the simple growth factor remains positive. Version 1.0.0 deliberately avoids fabricating a yield curve, collateral curve, payment-interest convention or dealer credit adjustment from one annual rate.
Published clearing formulas can include contract-value factors and separate inverse quotation cases. This retail-facing version accepts a base-currency amount directly and blocks inverse settlement rather than silently applying the normal formula to the wrong contract.
Worked example from the audited fixture
The audited fixture enters a buy-base forward for EUR 100,000 at USD 1.10000 per EUR, a current same-maturity replacement forward of 1.12500, 90 days remaining and a 4% simple USD discount rate on a 360-day basis.
- The contracted quote amount is USD 110,000 and the replacement amount is USD 112,500. Their buy-base maturity difference is positive USD 2,500.
- The discount growth factor is 1.01 and the discount factor is 0.99009901. Estimated present value is therefore positive USD 2,475.25 under the entered normal-settlement assumptions.
Reproduce it: select “Load audited example” above. The immutable fixture is recomputed from the disclosed equation rather than copied from a provider result.
How to interpret the result
- Confirm contract direction from the base-currency perspective. “Buy EUR / sell USD” is buy-base for a EUR/USD quote; reversing the label changes the sign.
- Use a replacement forward for the same remaining value date. Spot is not a same-maturity substitute because the original contract exchanges currencies later.
- Read positive and negative as arithmetic value signs under the entered method, not as a statement of cash immediately available from a dealer.
- Request the provider’s actual closeout or novation quote before acting. Bid-ask spread, credit, documentation, collateral, liquidity and termination charges can materially change it.
- Use a discount rate consistent with the quote currency and valuation context. A deposit APY, policy rate and collateral discount curve are not interchangeable.
- Keep this result separate from financial reporting. Accounting fair value can require institution-specific curves, credit adjustments, documentation, controls and reporting standards.
Assumptions and limits
- No contract, confirmation, dealer quote, bank account, broker account, yield curve, collateral system, payment or settlement record is connected.
- Normal quote-currency settlement only is supported. Inverse, non-deliverable, fixing-based, option-like, cancellable and structured contracts are excluded.
- The replacement forward is entered by the user and not checked for matching maturity, side, bid or ask, amount, value date, settlement type or timestamp.
- One simple discount rate replaces a full curve. Credit, collateral, funding, liquidity, bid-ask spread, payment interest, taxes, fees and closeout conventions are excluded.
- Accounting fair value, hedge accounting, legal enforceability, counterparty exposure, capital requirements and financial reporting are not provided.
- No closeout, rollover, hedge, provider, broker, rate, direction, accounting treatment, strategy, signal or trade is recommended.
Which FX forward calculator answers which question?
These pages share one governed visual shell but keep three decisions separate. The rate calculator estimates a frictionless parity rate, the hedge calculator compares one partial-hedge cash-flow scenario, and the value calculator approximates a normal quote-currency replacement value for an existing contract. Separating them prevents a theoretical rate from becoming an executable quote, a scenario benefit from becoming an optimal hedge claim, or a replacement value from becoming accounting fair value.
| Tool | Primary input | Primary output | Hard boundary |
|---|---|---|---|
| Forward Rate | Spot, two rates and tenor | Theoretical parity rate and points | No executable quote or forecast |
| Forward Hedge | Exposure, hedge share and two entered rates | One partial-versus-unhedged scenario | No optimal hedge decision |
| Forward Value | Contract and same-maturity replacement rates | Normal quote-currency present-value estimate | No dealer closeout or accounting fair value |
Frequently asked questions
- It compares contracted and current same-maturity replacement quote amounts, applies the buy-base or sell-base direction sign and discounts the maturity difference with one entered simple rate.
- Use a current forward for the same remaining maturity, value date, settlement type, currency pair, amount context and quote convention—not the current spot rate.
- Buy-base uses replacement minus contract amount. Sell-base reverses that difference because the economic direction of the original base-currency exchange is opposite.
- No. It is an educational arithmetic estimate. A dealer closeout can include bid-ask spread, credit, collateral, liquidity, documentation and termination charges.
- The replacement-versus-contract cash-flow difference occurs at maturity. The page applies an entered quote-currency simple discount factor to estimate a present amount.
- No. Version 1.0.0 supports the normal quote-currency case only and blocks inverse, fixing-based, non-deliverable and structured-contract claims.
- No. Accounting fair value can require controlled curves, credit adjustments, collateral, documentation, reporting policies and independent valuation processes not provided here.
- No. Every amount, direction, rate, remaining day count and discount convention is entered locally and remains unverified.
Sources and methodology
- U.S. Securities and Exchange Commission — CME FX Mark-to-Market Filing — Primary reference for the normal settlement-price-minus-trade-price value structure, quantity sign and discount factor.
- Bank for International Settlements — Covered Interest Parity — Primary reference for the rate relationship and the transaction, counterparty and market-friction boundaries.
- Infront — FX Forward Calculator — Professional workflow reference for value-date, forward-point and broken-date complexity.
Version 1.0.0 performs deterministic local arithmetic and uploads no entered value. Sources define parity, valuation structure and professional-market boundaries; they do not verify an input, contract, provider quote or result.
Audit the rate and exposure before reading value
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Calculator outputs do not replace current broker or provider disclosures. Verify the exact entity, account, symbol, pricing, settlement, margin and execution terms available in your jurisdiction before opening or funding an account.
Risk and affiliate disclosure: Leveraged forex and CFD trading can result in substantial losses. Entered forward-rate, hedge and contract-value scenarios do not predict markets, establish executable prices, determine suitability or provide accounting fair value. These are affiliate links, so ForexMT4Indicators.com may receive compensation if you register or trade through them, at no additional cost to you. Availability and terms vary by jurisdiction and entity.