The so-called futures generally refers to futures contracts, which are standardized contracts made by futures exchanges and agreed to deliver a certain amount of subject matter (basic assets) at a specific time and place in the future. This subject matter, also known as the underlying asset, can be a commodity, such as copper or crude oil, a financial instrument, such as foreign exchange and bonds, or a financial indicator, such as three-month interbank offered rate or stock index. If the buyer of a futures contract holds the contract until the expiration date, he is obliged to purchase 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 refers to the final settlement of the futures contract in the opponent 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.

The broad concept of futures also includes option contracts traded on exchanges. Most futures exchanges list both futures and options.

3. What is the difference between stock index futures and stocks?

Compared with stocks, stock index futures have several distinct characteristics, which are particularly important for stock investors:

(1). Futures contracts have an expiration date and cannot be held indefinitely.

Stocks can be held all the time after buying, and the number of stocks will not decrease under normal circumstances. However, stock index futures have a fixed expiration date and will be delisted when it expires. Therefore, trading stock index futures cannot be equated with buying and selling stocks. You must pay attention to the expiration date of the contract to decide whether to close the position in advance or wait for the expiration of the contract (fortunately, stock index futures are settled in cash, and there is no need to actually deliver the stock), or transfer the position to next month.

(2) Futures contracts are margin transactions and must be settled every day.

Stock index futures contracts use margin trading. Generally, a contract can be bought and sold only by paying about 10- 15% of the contract face value. On the one hand, it improves the profit space, but on the other hand, it also brings risks, which requires daily settlement of profits and losses. After buying a stock, the book profit and loss are not settled before selling. However, stock index futures are different. After the transaction, the contract held in hand should be settled at the settlement price every day, and the book profit can be withdrawn, but the book loss (that is, additional margin) must be made up before the opening of the next day. And because it is a margin transaction, the loss may even exceed your investment principal, which is different from stock trading.

(3) Futures contracts can be sold short.

Stock index futures contracts can be easily sold short and then repurchased after the price falls. It is ok to short stocks, but it is relatively difficult. Of course, once the price rises instead of falling after short selling, investors will face losses.

(4) High market liquidity.

Research shows that the liquidity of stock index futures market is obviously higher than that of stock spot market. For example, 199 1, the trading volume of FTSE-100 index futures has reached 85 billion pounds.

(5) Stock index futures shall be delivered in cash.

Although the futures market is a derivative market based on the stock market, it is delivered in cash, that is, only the profit and loss are calculated at the time of delivery, and the physical object is not transferred. During the delivery of futures contracts, investors do not have to buy or sell the corresponding stocks to fulfill their contractual obligations, thus avoiding the phenomenon of "crowding" in the stock market during the delivery period.

(6) Generally speaking, the stock index futures market focuses on buying and selling according to macroeconomic data, while the spot market focuses on buying and selling according to the situation of a single company.