Financial Contract Law and Legal Definition

In terms of Securities law, financial contract is an arrangement that takes the form of an individually negotiated contract, agreement, or option to buy, sell, lend, swap, or repurchase, or other similar individually negotiated transaction commonly entered into by participants in the financial markets. A financial contract involves securities, commodities, currencies, interest or other rates, or any other financial or economic interest similar in function. This contract is entered into in response to a request from counterparty for a quotation, or to accommodate the objectives of the counterparty to such an arrangement.