Forward Contract Valuation at Initiation

Very Easy Forward Pricing And Valuation Equity Forwards

Consider an investor who enters into a forward contract to buy 100 shares of XYZ Corporation at a forward price of $50 per share, with the delivery date set for one year from now. Assuming that the stock price of XYZ Corporation is currently $48 and there are no dividends paid on the shares, what is the value of this forward contract at initiation?

The value is $0.