Futures are relative to spot. Spot is cash spot, and futures are contract transactions, that is, mutual transfer of contracts. There is a time limit for futures delivery. Before the expiration, it is a contract transaction, but the expiration date is to cash the contract for spot delivery.
Large futures institutions often do both spot and futures, which can be used for hedging and speculation. Ordinary investors often can't deliver in time, so they have to speculate purely, and the speculative value of commodities is often related to factors such as spot trend and duration of commodities.
The process of speculation in futures market;
Futures trading is a kind of contract trading, and each transaction only needs to pay the deposit of the actual price of the corresponding commodity-the deposit. The specific margin ratio is determined by the futures exchange according to market conditions, and the futures company will also make adjustments.
Futures market usually refers to futures contracts. It is a standardized contract made by the futures exchange, which stipulates to deliver a certain number of subject matter at a specific time and place in the future. This topic can be commodities, financial instruments or financial indicators.
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; The seller of a futures contract has the obligation to sell the subject matter corresponding to the futures contract when the contract is held to maturity, and the trader of the futures contract 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.