What do you mean by cash transfer?
Cash-for-futures refers to the conversion from futures to spot after the two parties holding the same delivery month contract reach a spot trading agreement. Usually, the way of cash conversion is: both parties who reach an agreement apply to the exchange at the same time, and then get the approval of the exchange, so they can close their positions separately according to the closing price agreed by both parties, and then the exchange will close the positions on their behalf. At the same time, the two sides will conduct spot trading according to the spot trading agreement reached, and then carry out spot exchange with the quantity and variety marked on the futures contract.
Necessity of cash conversion
1, cash conversion can improve the efficiency of capital utilization. Installment payment can help management, processing and production enterprises avoid price risks and improve the efficiency of capital utilization. If the processing enterprises concentrate on delivery when the contract expires, they need to spend a lot of money to purchase goods, which will increase the risk of the processing enterprises. If the use period is converted into cash, it can be purchased in batches according to the demand, which can reduce the financial pressure and reduce the inventory.
2. Installment payment can also enable buyers and sellers to flexibly choose the delivery time, place and grade to meet the requirements of production and operation enterprises and processing enterprises for the grade of goods, and can also flexibly choose the delivery place, thus reducing the delivery cost.
My conclusion: The above content is an introduction to the significance of cash transfer, and I hope it will help you. I believe that after the above, you will know more about cash transfer, and you can also refer to this method in future investment cooperation.