Futures trading is a centralized trading form of standardized forward contracts. That is, the trading behavior of both parties in the futures exchange to buy and sell a certain quantity and quality of goods at a certain price at a certain time and place in the future according to the terms stipulated in the contract. The ultimate goal of futures trading is not the transfer of commodity ownership, but to avoid spot price risk by buying and selling futures contracts.

Futures trading is a new type of exchange developed by trading on the futures exchange on the basis of spot trading and standardized futures contracts.

Simple method.

Futures trading is a centralized trading form of standardized forward contracts. That is, the trading behavior of both parties in the futures exchange to buy and sell a certain quantity and quality of goods at a certain price at a certain time and place in the future according to the terms stipulated in the contract. The ultimate goal of futures trading is not the transfer of commodity ownership, but to avoid spot price risk by buying and selling futures contracts.

Futures trading is a new type of exchange developed by trading on the futures exchange on the basis of spot trading and standardized futures contracts.

Simple method.

Futures trading follows the principle of "openness, fairness and justice".

Buying futures is called "short selling" or "long trading", that is, long trading.

Selling futures is called "short selling" or "short selling", which means short selling.

The trading behavior of buying futures contracts or selling futures contracts is called "opening positions", and the contracts held by traders are called "positions".

Traders know the contract in their hands and trade in reverse, which is called "liquidation" or "hedging". If it is the delivery month, the trader's hand will be closed.

If the contract has not been hedged, then those who hold short contracts should prepare for physical delivery, and those who hold long contracts should prepare for capital acceptance.

Things. Under normal circumstances, most contracts are settled by hedging before expiration, and only a few need physical delivery.

Futures trading and spot trading have something in common: both are trading methods, both are real transactions, and both involve the transfer of commodity ownership.

Shift, etc

The difference between futures trading and spot trading;

1. The direct target of buying and selling is different.

The direct object of spot trading is the commodity itself, including samples, objects and pricing.

The direct object of futures trading is futures contracts, not how many contracts to buy or sell.

2. The purpose of the transaction is different. Spot trading is the transaction of primary currency and primary commodities, that is, obtaining or selling commodities immediately or within a certain period of time.

Right is a direct means to meet the needs of buyers and sellers.

The purpose of general futures trading is not to obtain the due physical objects, but the purpose of hedgers is to transfer the price wind in the spot market through futures trading.

Risk, the purpose of investors is to obtain risk profits from price fluctuations in the futures market.

3. Different trading methods

Spot transactions are generally one-on-one negotiations to sign contracts. The specific content shall be agreed by both parties. If the contract cannot be fulfilled after signing, it will be resorted to law.

Law.

Futures trading is conducted in an open and fair manner. One-on-one negotiation (or private hedging) is considered illegal.

4. Different trading places

Spot trading is generally not limited by trading time, place and object, and it is flexible, convenient and random, and can be used anywhere.

Hand trading.

Futures trading must be conducted in an open and centralized manner in the exchange according to law, and cannot be traded over the counter.

5. Different product ranges

The varieties of spot trading are all commodities in circulation, while the varieties of futures trading are limited. Mainly agricultural products, oil, metal dealers.

Products and some primary raw materials and financial products.

6. Different settlement methods

Spot trading is cash on delivery, no matter how long it takes, it is a settlement or several settlements.

Futures trading adopts a daily debt-free settlement system, and profits and losses must be settled daily. The settlement price is calculated according to the weighted average of transaction prices.

Characteristics of commodity futures trading:

1. Turn small into big: paying 2-20% performance bond can control 100% of virtual funds.

Second, the convenience of transaction: because the main factors in futures contracts, such as commodity quality and delivery place, have been standardized, the contracts are interchangeable and liquid.

High versatility.

Third, the information is open and the transaction efficiency is high: futures trading enables traders to compete fairly under equal conditions through open bidding. the same

At that time, futures trading had a fixed place, procedures and rules and operated efficiently.

4. Futures trading can be operated in both directions, which is simple and flexible: you can buy or sell futures contracts after paying the deposit, and only need a small amount.

A few instructions can complete a transaction in seconds or minutes. When the market is at a favorable price, close the position or cover the position in the opposite direction.

5. The performance of the contract is guaranteed: after the futures transaction is completed, it must be confirmed by the settlement department, and there is no need to worry about the performance of the transaction.

Title.

There are limited varieties of futures trading. Mainly agricultural products, oil,

Metal dealers, products and some primary raw materials and financial products.