The difference between two forward rates or two forward prices. This spread can be used to calculate the payoff and the value of a derivative contract. For example, the forward spread may reflect the price difference between the spot price of a security and and its forward price. The forward spread is usually figured out by subtracting the spot price/ rate from the one-month forward price/rate. This spread is equal to zero when the forward price/ rate and the spot price/ rate have the same value. For example, if the spot price and one-month forward price of the security are 10 and 10.5, respectively, then the forward spread is 0.5, or 50 basis points.