Business Finance

Forward dealing refers to the practice of entering into agreements to buy or sell financial instruments, commodities, or currencies at a future date, at a predetermined price. It involves private negotiations between parties, aiming to secure future transactions based on current market conditions and expectations. Key Features of Forward Dealing How Does Forward Dealing Work? […]

As someone who has spent years navigating the complexities of international finance, I know how daunting foreign exchange risks can be for businesses and investors. One of the most effective tools to hedge against currency fluctuations is a forward-exchange contract (FEC). In this guide, I’ll break down everything you need to know about FECs—how they

Forward margin refers to the additional amount or percentage added to the spot price of a financial instrument or commodity to determine its forward price. It represents the cost or profit margin embedded in a forward contract, which is agreed upon between two parties for a transaction to be settled at a future date. Key

Forward price refers to the agreed-upon price at which two parties agree to buy or sell an asset in the future. It is determined at the inception of a forward contract, which is a private agreement between the buyer and seller to exchange the asset at a specified future date. Key Features of Forward Price

A Forward-Rate Agreement (FRA) is a financial contract between two parties that allows them to lock in an interest rate today for a transaction that will take place in the future. FRAs are often used by financial institutions, corporations, and investors to hedge against fluctuations in interest rates. These agreements specify a future date (settlement

Founders’ shares are a class of shares issued to the original founders or early investors of a company. These shares typically carry special rights or privileges that differentiate them from common shares. Founders’ shares are often issued during the initial stages of a company’s formation and are used to reward and incentivize founders for their

Fractional banking refers to a banking system where banks keep only a fraction of their deposits in reserve and lend out the remainder. This practice allows banks to create credit and expand the money supply beyond the amount of base money (such as cash and reserves) held by the central bank. Fractional banking is the

Franked Investment Income (FII) refers to dividends received by a shareholder that have already been taxed at the corporate level before distribution. This concept primarily exists in tax systems that aim to prevent the double taxation of corporate profits. When a company pays a dividend from its after-tax profits, the recipient (shareholder) receives a tax

Fraudulent conveyance refers to the illegal transfer of property or assets by a debtor to another party with the intention of putting those assets out of the reach of creditors. This act is designed to defraud creditors by making it difficult or impossible for them to collect what they are owed. Fraudulent conveyance is considered

Fraudulent trading occurs when a company continues to operate and incur debts with no intention of repaying them, usually while knowing that the business is insolvent. This illegal practice is intended to deceive creditors, employees, or investors, and it can lead to severe legal consequences for those involved. Fraudulent trading is a serious offense because