Learn all about futures. Read a detailed definition of futures contract, understand what futures are in finance, and see an example of a futures...
A futures contract is a standardized exchange-traded contract on a currency, a commodity, stock index, a bond etc. (called the underlying asset or just underlying) in which the buyer agrees to purchase the underlying in future at a price agreed today.
Let’s consider an example to understand how a commodity futures contract works: Imagine a farmer who grows corn. The farmer is concerned about potential price volatility in the future, which could harm his profits. To protect against that risk, the farmer can enter into a commodity futures co...
Contract size. This is the quantity of the asset in each contract, which is standardized and does not change but can be different for each instrument. For example, one contract of Crude Oil (/CL) represents 1,000 barrels. The E-Mini S&P 500 futures (/ES) represent 50 times the price ...
(所以,期货的定价要比远期困难,不能明确交割的具体时间) The delivery months vary from contract to contract and are chosen by the exchange to meet the needs of market participants. Example: Currency futures on the Chicago Mercantile Exchange have delivery months of March, June, September and ...
Contract specs also apply in asset classes such as options. Let’s look at some examples of futures contract specs. Contract sizes or units For commodity futures, contract size usually refers to quantities or volumes. For example: Grains such as corn, soybeans, and wheat. One futures contract...
Treasury bond futures contractÐone of the most widely traded of all ®nancial futures contractsÐallows for the delivery of a wide range of Treasury bonds and that the procedure for adjusting the delivery price of these bonds rarely conforms to the dierences in market prices. An exte...
Index futures contract specs For educational purposes only. Not a recommendation. Doing the math Here's an example of how tick sizes are a different sort of animal versus stocks. Say a trader holds 100 shares of a stock trading at $10 per share, with a total position value of $1,000....
As an example, let's say aninitial marginamount of $3,700 allows an investor to enter into a futures contract for 1,000 barrels of oil valued at $45,000—with oil priced at $45 per barrel. If the price of oil is trading at $60 at the contract's expiry, the investor has a $15...
Stock futures have specific expiration dates and are organized by month. For example, futures for a major index like the S&P 500 might have contracts expiring in March, June, September, and December.6The contract with the nearest expiration date is known as the "front-month" contract, which ...