Value Date
Posted by Ripon Abu Hasnat on Friday, June 13, 2014 | 0 comments
Value date in finance is the date when
the value of an asset that fluctuates in price is determined. The value date is
used when there is a possibility for discrepancies due to differences in the
timing of asset valuation. It usually applies to forward currency contracts,
options and other derivatives, interest payable or receivable. In accounting,
value date is the date when the entry to an account is considered effective.
In
banking, value date is the delivery
date of funds traded. For spot transactions it is the future date on which the
trade is settled. In the case of a spot foreign exchange trade it is normally
two days after a transaction is agreed upon. A future date used in determining
the value of a product that fluctuates in price. Typically, you will see the
use of value dates in determining the payment of products and accounts where
there is a possibility for discrepancies due to differences in the timing of
valuation. Such products include forward currency contracts, option contracts,
and the interest payable or receivable on personal accounts.
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