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Topic: Futures contract


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  Futures Contract
A futures contract is simply a contract that involves delivery of some specific asset by a seller to a buyer at an agreed-upon future date.
By establishing a uniform contract and trading it on a futures exchange, each party to the contract could undo his side of the transaction by offsetting his initial position with a third party on any business day prior to the contract's delivery date.
Futures contracts were initially developed for physical commodities such as raw materials and food stuffs.
www.aisgroup.com /AIS_Capital/Futures_Contract/body_futures_contract.html   (732 words)

  
  The Economic Purpose of Futures Markets   (Site not responding. Last check: )
Futures contracts are very similar to forward contracts, but futures contracts typically have certain features that make them more useful for hedging and less useful for merchandising than forward contracts.
Futures contracts typically are traded on organized exchanges in a wide variety of physical commodities (including grains, metals, and petroleum products) and financial instruments (such as stocks, bonds, and currencies).
Futures trades that are made on an exchange are cleared through a clearing organization (clearing house), which acts as the buyer to all sellers and the seller to all buyers.
www.cftc.gov /opa/brochures/opaeconpurp.htm   (4104 words)

  
 Invest FAQ: Derivatives: Futures
In other words, it is a contract between two parties; the holder of the future has not only the right but also the obligation to buy (or sell) the specified commodity.
Futures contracts are traded on futures exchanges, of which the U.S. has eight.
Futures are explicitly designed to allow the transfer of risk from those who want less risk to those who are willing to take on some risk in exchange for compensation.
invest-faq.com /articles/deriv-futures.html   (596 words)

  
 The Futures Contract
A futures contract is defined as a legally binding agreement, made on the trading floor of the exchange, to buy or sell a commodity or financial instrument sometime in the future.
Futures contracts are standardized according to the quantity, quality, and delivery time and location for each commodity.
Futures and options may not be a suitable investment for all individuals should carefully consider their financial condition in deciding whether to trade.
www.gc-financialgroup.com /GCFO/GCFOfuturescontract.htm   (820 words)

  
 OneChicago - Glossary
The holder of a short position in a futures contract that is physically settled must deliver the underlying instrument to the holder of a long position in accordance with the standard delivery cycle specified by the futures contract.
Futures Commission Merchant (FCM): A firm or person engaged in soliciting or accepting and handling orders for the purchase or sale of futures contracts, subject to the rules of a futures exchange and, who, in connection with solicitation or acceptance of orders, accepts any money or securities to margin any resulting trades or contracts.
Futures contracts outstanding at the end of the last trading day must be settled by delivery of the underlying instrument or by agreement for monetary settlement (in some cases by EFPs).
www.onechicago.com /000000_misc/oc_000010.html   (7459 words)

  
 Futures Contract
A future is transacted through a brokerage firms that hold a "seat" on the exchange that trades that particular contract.
For a single futures contract, it will be a small fraction of the market value of the futures' underlier.
For futures spreads, or if you are using futures to hedge a physical position in the underlier, initial margin may be even lower.
www.riskglossary.com /articles/future.htm   (1716 words)

  
 Futures contract
All futures are exchange-traded contracts and they are standardised in terms of the delivery date, the amount of the 'underlying' they relate to, and the contract terms.
Although futures contracts, if held till "delivery", lead to fulfilment of their commitments, generally speaking, very few contracts are taken to delivery.
When clients wish to buy or sell a futures contract they instruct a broker, who will be a member of the exchange where the futures contract is traded.
www.financial-guide.ch /ica/derivatives/focus_on_futures/fundamentals/index.html   (416 words)

  
 Futures
Cash Settlement: Transactions generally involving index-based futures contracts that are settled in cash based on the actual value of the index on the last trading day, in contrast to those that specify the delivery of a commodity or financial instrument.
Futures contracts outstanding at the end of the last trading day must be settled by delivery of the underlying commodity or securities or by agreement for monetary settlement (in some cases by EFPs).
A buyer of a futures contract is said to have a long position and, conversely, a seller of futures contracts is said to have a short position.
www.smithbarney.com /prod_svc/futures/glossary.html   (5848 words)

  
 Futures Contract   (Site not responding. Last check: )
The contract is subject to the terms and conditions established by a federally designated contract market upon which trading is conducted.
A futures contract differs from an option in that an option is a right to buy or sell, whereas a future is a promise to actually make a transaction.
A future is part of a class of securities called derivatives, so named because such securities derive their value from the worth of an underlying investment.
www.russell.com /us/glossary/derivatives/futures_contract.htm   (138 words)

  
 futures contract Definition
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.
Futures contracts are forward contracts, meaning they represent a pledge to make a certain transaction at a future date.
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.
www.investorwords.com /2136/futures_contract.html   (334 words)

  
 Futures Contract
Futures contracts detail the quality and quantity of the underlying asset; they are standardized to facilitate trading on a futures exchange.
Some futures contracts may call for physical delivery of the asset, while others are settled in cash.
Futures Fundamentals - For those who are new to futures but want a solid understanding of them, this tutorial explains what futures contracts are, how they work and why investors use them.
www.investopedia.com /terms/f/futurescontract.asp   (546 words)

  
 Contract Specifications for Futures and Options, Futures Contract Sizes, Futures Contract Specs
Essential information about every futures and options contract is right at your fingertips.
Our contract specs screen will show you trading hours, tick value, margin requirement, plus much more.
Simply enter the symbol for the futures or options contract in which you're interested, and our contract specifications screen will give you all the nuts-and-bolts information you need to trade that market.
www.xpresstrade.com /contract_specs.php   (201 words)

  
 Research: Futures Contract Specifications | RJO Futures - Online Futures Trading, Futures Brokers, and Commodity Brokers
When trading futures and/or options, it is possible to lose more than the full value of your account.
Past performance is not necessarily indicative of future results.
If you access and use this website, you accept and agree to be bound by, and comply with, the legal terms of use that must be accessed and read by clicking on the link "Disclaimer".
www.rjofutures.com /resources/futures_specifications.php   (175 words)

  
 Option Futures Contract Trading   (Site not responding. Last check: )
Options on futures contracts were introduced at the CBOT in October 1982 when the exchange began trading Options on U.S. Treasury Bond futures.
For instance, if T-bond futures were purchased at 80-00 and a call option with an 80 strike price was sold for 2-00, T-bond futures could decline to the 78-00 level before there would be a net loss in the position (excluding, of course, margin and commission requirements).
For instance, if an institution is long T-bond futures at 82-00 and a T-bond put option with an 82 strike is purchased for 2-00, the futures contract could, theoretically, fall to zero and the put option holder could exercise the option for the 82 strike price, assuming the option had not yet expired.
www.agtraders.com /options101.cfm   (1888 words)

  
 Futures 101
Futures prices increase and decrease largely because of the myriad factors that influence buyers' and sellers' judgments about what a particular commodity will be worth at a given time in the future (anywhere from less than a month to more than two years).
Delivery-type futures contracts stipulate the specifications of the commodity to be delivered (such as 5,000 bushels of grain, 40,000 pounds of livestock, or 100 troy ounces of gold).
Futures contracts that call for cash settlement rather than delivery are based on a given index number times a specified dollar multiple.
www.orionfutures.com /fut101.htm   (11475 words)

  
 Types of Contracts page for Futures Examiner: to compare results from Futures Trading Systems
Commodity futures contracts were originally intended to allow buyers and sellers of physical commodities such as wheat or crude oil to agree, in advance of delivery, on a price for a stated quantity of a particular commodity.
A commodity futures contract has a delivery or expiry date, which is usually on the third Friday of the final month of the contract.
Looking at the data for some commodity futures contracts for currencies, the leverage for EC and JY are both 10.9, and the leverage for SF is 8.2, for an average Leverage of 10.0 (as of mid 2004) when the account size is 5 * margin, which we use for our "conservative" account size.
www.futuresexaminer.com /contrTypes.php   (1899 words)

  
 Futures contract Summary
A futures contract is an agreement that calls for a seller to deliver to a buyer a specified quantity and quality of an identified commodity, at a fixed time in the future,...
In finance, a futures contract is a standardized contract, traded on a futures exchange, to buy or sell a certain underlying instrument at a certain date in the future, at a pre-set price.
The future date is called the delivery date or final settlement d...
www.bookrags.com /Futures_contract   (159 words)

  
 Futures
Contract Grade - That grade of commodity that has been approved by an exchange as deliverable in settlement of a futures contract.
In the futures market, to purchase or sell for future delivery as a temporary substitute for a merchandising transaction to be made later.
Futures contracts outstanding at the end of the last trading day must be settled by delivery or, in the case of cash settlement, by an exchange of cash value differences.
www.futuresmag.com /cms/futures/website/glossary/glossary1   (2371 words)

  
 Futures Dictionary   (Site not responding. Last check: )
This factor is based on the relationship of the cash-instrument coupon to the required 8 percent deliverable grade of a futures contract as well as taking into account the cash instrument's maturity or call.
Underlying Futures Contract: The specific futures contract that is bought or sold by exercising an option.
Risk Disclosure: Trading futures markets on margin carries a high level of risk, and may not be suitable for all investors.
futures.fxstreet.com /Futures/content/100970/content.asp   (7168 words)

  
 Futures Trading Systems | Commodity Courses | Stock Futures | Futures Brokers | Options Training | Futures Charts | ...
Margin requirements are generally 20% of the cash value of contract, although this requirement may be lower if the investor also holds certain offsetting positions in cash equities, stock options, or other security futures in the same securities account.
A OneChicago single stock futures contract is an agreement for delivery of shares of a specific stock at a designated date in the future, called the expiration date.
A stock futures contract is an agreement to buy or sell shares of individual companies some time in the future at an agreed upon price.
www.futurestraining.com /fe_ssf.htm   (855 words)

  
 FuturesBuzz.com - Fundamental Research - Crude Oil
Additional risk management and trading opportunities are offered through options on the futures contract; calendar spread options; crack spread options on the pricing differential of heating oil futures and crude oil futures and gasoline futures and crude oil futures; and average price options.
The e-miNYsm crude oil futures contract, designed for investment portfolios, is the equivalent of 500 barrels of crude, 50% of the size of a standard futures contract.
The Brent blend futures contract is based on a light, sweet North Sea crude oil that serves as a benchmark grade and widely trades as a differential to the NYMEX Division's bellwether light, sweet crude oil futures contract.
www.futuresbuzz.com /fr_crude.html   (575 words)

  
 Futures Knowledge;Futures and Commodities:Online brokerage research, day trade, discount broker, options, online ...
Margin requirements for selling a futures contract are the same as for buying a futures contract, and daily profits or losses are credited or debited to the account in the same way.
While most speculative futures transactions in-volve a simple purchase of futures contracts to profit from an expected price increase—or an equally simple sale to profit from an ex-pected price decrease—numerous other pos-sible strategies exist.
As an illustration, assume it’s now November, that the March wheat futures price is presently $3.50 a bushel and the May wheat futures price is presently $3.55 a bushel, a difference of 5ยข.
www.futuresknowledge.com /Education_Center/10.asp   (1037 words)

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