We all know that futures trading usually involves hedging and closing positions before the contract expires, that is, buying and selling futures of the same variety and quantity in opposite directions in the market, but many people want to know whether futures can be delivered in kind. Let's take a look together.

Can futures be delivered in kind?

Of course.

Futures can be closed not only by hedging, but also by delivery, which can be divided into physical delivery and cash settlement.

However, the premise of physical delivery is that this variety can be delivered in kind, and the physical delivery is carried out by legal person households, not individuals, and natural persons cannot deliver, so we have to open a futures account in the name of the company. In addition, we also need to consider the storage cost and transportation cost of physical delivery.

In fact, most investors who do futures trading do not aim at spot trading. If physical delivery is really necessary, then we can keep the position in the delivery month, and the number of positions is an integer multiple of that stipulated by the exchange, and make up the deposit stipulated before delivery according to the requirements of the exchange until the last trading day.

Then the futures company will contact us to confirm the delivery. The futures company will initiate the delivery process to the exchange, handle the delivery procedures for us, and make up the balance according to the notice of the futures company. This price is calculated according to the settlement price on the last trading day. The futures company will withhold tax from your settlement account, and the exchange will issue you an invoice and a standard warehouse receipt. Finally, you can go to the delivery warehouse designated by the exchange to pick up the goods.