Gold and silver crude oil is a specific investment product, which is divided into futures and spot. Spot is a standardized contract for futures.
Stocks invest in shares of listed companies, and foreign exchange earns the difference through exchange rate fluctuations.
The difference between spot and futures:
First, the trading time is different.
Futures trading time is only 4 hours a day, while spot trading is 24 hours. It can be traded from 8 am on Monday to 4 am on Saturday.
Second, due to the different delivery time and term, the risk of spot trading is far less than that of futures.
Futures refers to a standard contract with a delivery period, so it is called futures. The reason why futures trading is so risky is that futures trading has a delivery time limit. Because futures trading must be delivered on the maturity date, if the futures contract price in hand approaches the futures delivery date, investors must close their positions, even if they are at a loss (or even a huge loss). The spot deferred delivery business has no delivery time limit, and investors can hold warehouse receipts for a long time without being forced to close their positions.
Third, the difference between market makers and exchanges.
Futures trading generally requires centralized matchmaking trading in futures exchanges. Exchanges must be members to trade, and ordinary customers must trade through member agents. Futures trading shall follow the principle of price priority and time priority. In the futures market, the transaction price is uncertain, because all orders must be matched through a centralized exchange, thus limiting the number of traders with the same price.
The London Stock Exchange, which has the largest market transaction volume and the largest market transaction scale in the international market, does not have a centralized transaction exchange, but a market maker network consisting of five market makers (internationally renowned banks) and a large number of gold merchants at the next level, providing spot deferred settlement mode. Investors can buy and sell freely, make a deal at any time, and the market price is open and transparent, fair and just!
Fourth, the price formation mechanism is different.
The spot deferred transaction price is quoted by the 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. Zhong Yi precious metals trading platform is one of the largest precious metals trading platforms in China. The platform is a precious metal trading platform launched by Zhong Yi Precious Metals Trading Company, which is mainly based on trading spot and gold spot; Provide industry-leading electronic trading of precious metals and excellent customer service for individuals and agents.
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5. Whether the transaction object is 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.