Exchange Currency

futures contract

A standardized, transferable, exchange-traded contract that requires delivery of a commodity, bond, currency, or stock index, at a specified price, on a specified future date. Unlike options, futures convey an obligation to buy. The risk to the holder is unlimited, and because the payoff pattern is symmetrical, the risk to the seller is unlimited as well. Dollars lost and gained by each party on a futures contract are equal and opposite. In other words, futures trading is a zero-sum game. Futures contracts are forward contracts, meaning they represent a pledge to make a certain transaction at a future date. The exchange of assets occurs on the date specified in the contract. Futures are distinguished from generic forward contracts in that they contain standardized terms, trade on a formal exchange, are regulated by overseeing agencies, and are guaranteed by clearinghouses. Also, in order to insure that payment will occur, futures have a margin requirement that must be settled daily. Finally, by making an offsetting trade, taking delivery of goods, or arranging for an exchange of goods, futures contracts can be closed. Hedgers often trade futures for the purpose of keeping price risk in check. also called futures.

Related information about futures contract:
  1. Futures contract - Wikipedia, the free encyclopedia
    In finance, a futures contract (more colloquially, futures) is a standardized contract between two parties to buy or sell a specified asset of standardized quantity ...
     
  2. Futures Contract Definition | Investopedia
    A contractual agreement, generally made on the trading floor of a futures exchange, to buy or sell a particular commodity or financial instrument at a ...
     
  3. Futures Contract - Financial Dictionary - The Free Dictionary
    A legally binding agreement to buy or sell a commodity or financial instrument in a designated future month at a price agreed upon at the initiation of the contract ...
     
  4. What is futures contract? definition and meaning
    Definition of futures contract: A standardized, transferable, exchange-traded contract that requires delivery of a commodity, bond, currency, or stock index, at a ...
     
  5. What is a Futures Contract?
    Learn to understand futures contracts. This is part of a 12 part online short course introducing the commodity markets and exchanges, with emphasis on futures ...
     
  6. Commodity Futures Contract Specifications
    Contract specifications for all North American-traded commodities. Conveniently collected and displayed for easy reference.
     
  7. Futures - Contract Specifications
    Futures contract specifications listed by market. Includes exchanges, tick value, point value and more.
     
  8. Gold Futures Contract Specification | Global Derivatives
    Current calendar month (for delivery purposes) and the next 2 months. Any February, April, August and October within 23 months of the current calendar month.