The commodity variety, trading unit, contract month, margin, quantity, quality, grade, delivery time and delivery place of futures contracts are all established and standardized, and the only variable is price. The standards of futures contracts are usually designed by futures exchanges and listed by national regulatory agencies.
Futures contracts are concluded under the organization of futures exchanges and have legal effect. Prices are generated through public bidding in the trading hall of the exchanges. Most foreign countries adopt public bidding, while our country adopts computer trading.
The performance of futures contracts is guaranteed by the exchange, and private transactions are not allowed.
Futures contracts can fulfill or cancel their contractual obligations through the settlement of spot or hedging transactions.
Terms and conditions:
1. The minimum change price refers to the minimum change in the unit price of a futures contract.
2. The daily maximum price fluctuation limit (also known as the price limit) means that the trading price of a futures contract in a trading day shall not be higher or lower than the prescribed price limit, and the quotation exceeding this price limit will be regarded as invalid and cannot be traded.
3. The delivery month of a futures contract refers to the delivery month stipulated in the contract.
4. The last trading day refers to the last trading day when a futures contract is traded in the contract delivery month.
5. The trading unit of a futures contract is the "hand", and futures trading must be conducted in integral multiples of the "hand". The number of commodities per lot of different trading varieties shall be specified in the futures contract of that variety.
6. The transaction price of the futures contract is the value-added tax price of the benchmark delivery goods of the futures contract delivered in the benchmark delivery warehouse. Contract transaction prices include opening price, closing price and settlement price.
If the buyer of a futures contract holds the contract until the expiration date, he is obliged to buy the subject matter corresponding to the futures contract; If the seller of a futures contract holds the contract until it expires, he is obliged to sell the subject matter corresponding to the futures contract (some futures contracts do not make physical delivery when they expire, but settle the difference, for example, the expiration of stock index futures means that the open futures contract is finally settled according to a certain average value of the spot index. Of course, traders of futures contracts can also choose to reverse the transaction before the contract expires to offset this obligation.