Characteristics of the transaction:
1) contract standardization. Except that the price fluctuates with the market, all the terms of the futures contract are agreed in advance.
2) Centralized trading. Futures trading must be concentrated in the futures exchange. The exchange implements a membership system, and only members can enter the market for trading. OTC investors can only entrust brokerage companies to participate in futures trading.
3) Two-way trading and hedging mechanism. Unlike securities trading, futures trading can not only buy before selling, but also allow traders to sell before buying. This makes investors have profit opportunities in both bull market and bear market. Hedging liquidation means that before the futures contract expires, the trader carries out the opposite transaction to the previous operation to end the trading activity without delivering the physical object.
4) Margin system. The charm of the futures market mainly lies in the fact that the whole transaction can be completed only by paying a small margin, which is generally 5- 10% of the contract value. This enables futures trading to change from small to large, increasing the opportunities for enterprising investors to make profits; For prudent investors, as long as the proportion of positions is arranged, risks can be flexibly controlled.
5)t+0. Contracts opened on the same day can be closed on the same day, making the operation more flexible.