Value of Forward contract

The CFA book explanation says that value of currency forward contract is:

Vt(T)=Present value of the difference in forward prices=PV£,t,T[Ft(£/€,T)−F0(£/€,T)]

But in the example:

Q) [question removed by moderator]

The value of the foreign exchange forward contract at Time t will be closest to?

The value per euro to the seller of the foreign exchange futures contract at Time t is simply the present value of the difference between the initial forward price and the £/€ forward price at Time t or

Vt(T) = PV£,t,T[F0(£/€,T) – Ft(£/€,T)]

Why is it taking Initial - forward price at T ?? why not the other way?

Is this because of the short position? . If it would have been long than Forward -Initial.


Yes, it’s the value of a short position, which is the negative of the value of the long position.