Spot gold is an international investment product, which is an investment and financial management project formed by gold companies establishing trading platforms and conducting online transactions with market traders in the form of leverage ratio. It is often called spot gold and is the largest stock in the world. Because the daily trading volume of spot gold is huge, the daily trading volume is about 20 trillion US dollars. Therefore, no consortium or institution can manipulate such a huge market artificially, relying entirely on the spontaneous adjustment of the market.
Gold futures
Futures gold refers to a futures contract with the gold price of the international gold market as the transaction target at a certain time in the future. The profit and loss of investors buying and selling gold futures is measured by the difference between the time of entry and exit, which is the physical delivery after the contract expires.
The difference between spot gold and futures gold;
Difference 1. The delivery time and cycle are different.
Futures refers to a standard contract with a delivery period, so it is called futures. There is generally no delivery time limit for spot delivery business.
Difference 2. The difference between market makers and exchanges.
The London Gold Exchange, which has the largest trading volume and market size in the international gold market, does not centrally match exchanges, but a network of gold market makers consisting of five major gold market makers, internationally renowned banks and a large number of gold merchants at the next level, providing a delayed delivery mode for spot gold.
Difference three. The price formation mechanism is different.
The spot deferred trading price is quoted by the gold market maker, and the customer decides whether to trade with the market maker according to the market maker's quotation. The price formation mechanism of futures trading is the price formed by centralized bidding of all traders in the exchange.
Difference 4. Is the transaction object specific?
"Whether the trading object is specific" is the biggest difference between futures and spot models. When investors participate in futures trading on the futures exchange, their trading objects are not specific. Any investor who makes a reverse trading declaration on the exchange may be his trading object, and the exchange is the intermediary guarantee link for matching transactions between these non-specific traders. At this point, futures and stock markets are completely similar, both of which are non-specific exchange models.