A futures contract refers to a standardized contract made by a futures exchange and agreed to deliver a certain quantity and quality of goods at a specific time and place in the future. It is the object of futures trading, and the participants in futures trading transfer the price risk and obtain the risk income by buying and selling futures contracts on the futures exchange.
Futures contracts are developed on the basis of spot contracts and spot forward contracts, but their most essential difference lies in the standardization of futures contract terms. Futures contracts traded in the futures market are standardized in the quantity, quality grade, delivery grade, premium standard of substitutes, delivery place and delivery month, which makes futures contracts universal.
In the futures contract, only the futures price is the only variable, which is generated by public bidding in the transaction.
Legal basis: Civil Code of People's Republic of China (PRC).
Article 464 Definition of Contract and Legal Application of Identity Relationship Agreement A contract is an agreement between civil subjects to establish, change and terminate a civil legal relationship. Agreements on status relations such as marriage, adoption and guardianship shall be governed by legal provisions on such status relations; If there are no provisions, the provisions of this part can be applied according to their nature.
Article 465 The validity of a lawfully formed contract is protected by law. A legally established contract is legally binding only on the parties, except as otherwise provided by law.