What is physical delivery and what is cash delivery?
Physical delivery refers to a way for both long and short parties to make physical delivery to close their positions according to their positions within the futures delivery date; Cash delivery refers to the transaction that pays the profit and loss of both positions and settles all open contracts based on the settlement price.
1 physical delivery: If an investor has a long contract of 10 tons of soybeans for physical delivery, the exchange will give him 10 tons of soybeans.
2 Cash delivery: If the total position of the stock index futures contract held by the investor is 654.38+10,000 yuan, the exchange will transfer 654.38+10,000 yuan to it.
Different types of futures also have regulations on the qualifications of investors participating in delivery. At present, China's commodity futures and treasury bonds futures are delivered in kind, while stock index futures are delivered in cash.
In commodity futures, individual investors cannot enter the delivery period, and their positions will be closed by the exchange on the last trading day. Only institutional investors with delivery qualifications can make delivery. Generally speaking, investors who need physical delivery are all enterprises involved in spot operation; For stock index futures, individual investors are allowed to hold positions and enter the delivery date.