FX Forwards Convention

bluetrin · April 25th, 2015, 10:12 am

When a FX forward is quoted, is the quote added to the mid Spot ?Or is the bid Of he FX Forward added to the bid of the FX Spot and the Ask to the Ask of the Spot ?

Martinghoul · April 25th, 2015, 10:21 am

In my experience, the initial quote you get is a two-way in terms of fwd points, i.e. a swap quote... If you explicitly ask for an outright fwd quote, you will be commonly given the full bid/offer, including for spot.

bluetrin · April 25th, 2015, 10:27 am

Thanks, I understand this part. But once you trade, on the confirmation, will the dealer add these pips to the the bid ask spot or will he use the mid ? In other words: is the bid ask of the forwards added on the top of the bid ask for the spot ? Is that what you said by 'including for spot' ?

Martinghoul · April 26th, 2015, 6:30 am

Yes, in my experience, it's included... That's one of the reasons that it's easier to ask for independent quotes.

bluetrin · April 26th, 2015, 9:14 am

Thanks Martin