So what's the difference between financial futures and stocks and bonds? There are mainly the following three points:
First, the product level is different.
Stocks and bonds belong to basic financial products, while financial futures belong to derivative products, such as treasury bonds futures, whose basic assets are bonds and their derivatives are futures.
As valuable securities, stocks and bonds have their intrinsic value. Securities holders have the right to obtain certain monetary income based on this voucher, which can be held for a long time for mortgage, guarantee and asset reserve.
Futures contracts have no intrinsic value, no mortgage, guarantee and reserve functions, and cannot be held for a long time. They must be delivered after the contract expires.
Second, the trading system is different.
Financial futures trading implements the margin system, and the trading implements two-way trading, which can be bought and sold.
In securities trading, there are generally only unilateral transactions, and only one-way transactions of buying first and selling later can be implemented. Securities lending transactions must also be borrowed from other institutions or individuals with securities before they can be sold.
Third, the purpose of the transaction is different.
Stocks and bonds are both securities products. The purpose of securities trading is the transfer of rights and interests, and futures trading is the transfer of risks.
The main purpose of trading securities assets such as stocks and bonds is to raise and transfer funds. Enterprises issue all kinds of securities, so that idle social funds can be pooled into long-term capital to solve the capital needs of enterprises.
Financial futures market transfers risks. One party involved in futures trading aims at hedging, while the other party aims at speculation. The risk is transferred from hedgers to speculators.