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.
What is a ‘Value Date’
A value date is 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. Also referred to as “valuta”.
Explaining ‘Value Date’
For example, in the case of savings bonds, the interest is compounded semi-annually so the value date is every six months. This removes any uncertainty for investors because their calculations of interest payments will be the same as the government’s.
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