Forex glossary
Spot (immediate settlement)
FX spot is an exchange of currencies at an agreed rate for near-date delivery under the pair's conventions and calendars. Many pairs use T+2, but exceptions exist. A spot quotation used as a CFD reference does not mean the client receives delivery of currencies.
Illustrative example
How does it work in practice?
Suppose a spot trade agreed on Tuesday provides for delivery of 200 EUR against 220 USD on Thursday, with no holidays in either currency's calendar. Near delivery does not mean the money changes hands when the rate is agreed.
A case to work through
Same reference, different agreements
Model: A agrees delivery of EUR against USD on a specified date; B settles a CFD price difference using the same reference.
- A exchanges currency amounts under its agreement.
- B provides contractual price P/L without ownership of those currencies.
What follows? Check value date and settlement type.
Example boundary: A symbol name alone determines neither delivery convention nor all costs.
A useful distinction
Spot (immediate settlement) / CFD (contract for difference)
A CFD gives price-change exposure; deliverable spot exchanges the agreed currencies.
Check your understanding
Read the delivery obligation from product terms.
Show the answer and explanation
The product agreement and confirmation
They specify delivery or difference settlement.
Products, delivery and financing calendars
Step 7 / 11 · 0 / 11 reviewed
View the full sequence →Progress is saved only in this browser.
Read the fuller explanation
Related terms
Sources and documentation
- BCBS/BIS: Foreign exchange risks — Basel Consolidated Guidelines, RMA20
The guidelines define a wholesale FX swap as a currency exchange combined with a reverse exchange with the same counterparty at a later date.
Document read: - CME EBS: value-date calendar
Settlement dates and currency calendars for the stated service; T+2 exercises use explicit assumptions.
The example illustrates the mechanism. Check current account conditions and instrument specifications with the provider.