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Terms of a futures contract
Quantity and unit clause

The futures contract of each commodity stipulates a unified and standardized quantity and unit of quantity, which are collectively called "trading units". For example, the Chicago Board of Trade stipulates that the trading unit of wheat futures contracts is 5000 bushels (about 27.24 kilograms of wheat per bushel), and each wheat futures contract is the same. If traders buy wheat futures contracts on the exchange, it means that they need to buy 5000 bushels of wheat on the contract expiration date.

Quality and grade clause

Commodity futures contracts stipulate unified and standardized quality grades, and generally adopt internationally recognized commodity quality grade standards. For example, because soybeans from China account for a large proportion in international trade, Japanese Nagoya Grain Exchange takes soybeans made in China as the standard of soybean quality grade.

Trading time clause The trading time of futures contracts is fixed. Every exchange has strict rules on trading hours. Generally, it is open for 5 days every week, and it is closed on Saturday, Sunday and national holidays. Generally, each trading day is divided into two periods, namely morning period and afternoon period. The morning session is 9:00- 1 1:30, and the afternoon session is 1:30-3:00.

Quotation unit clause Quotation unit refers to the unit used to quote futures contracts in the process of open bidding, that is, the monetary price of each unit of measurement. Domestic cathode copper, sugar, soybean and other futures contracts are all quoted at RMB/ton.

Name of contract terms The name of the contract shall indicate the name of the contract variety and the name of its listed exchange. Take the sugar contract of Zhengzhou Commodity Exchange as an example. The name of the contract is "Sugar Futures Contract of Zhengzhou Commodity Exchange". The contract name should be concise and clear, and at the same time avoid confusion.

Place of delivery clause

Futures contracts specify a standardized and unified delivery warehouse for the physical delivery of futures transactions to ensure the normal delivery of physical objects.

Terms of delivery

Commodity futures contracts stipulate the physical delivery month, and generally stipulate several delivery months, which are chosen by traders themselves. For example, the delivery months stipulated by the Chicago Board of Trade for wheat futures contracts are July, September, 65438+February, March and May of the following year. Traders can choose their own trading month to trade. If traders buy contracts in July, they will either close their positions before July or make physical delivery in July.

Minimum variable price clause

Refers to the minimum allowable variation range of the quotation of buyers and sellers in futures trading, and the price variation range at each quotation must be an integer multiple of this minimum variation price.

Limit clause of maximum fluctuation range of daily price

The transaction price of a futures contract on a certain trading day cannot be higher or lower than the settlement price of the previous trading day. If this range is reached, the transaction of the contract will be suspended. For example, the maximum daily price fluctuation of a wheat contract on the Chicago Board of Trade is 20 cents per bushel ($65,438+0,000 per contract).

Last trading day clause

Refers to the deadline for futures contracts to stop trading. Every futures contract has a certain month limit. On a certain day in the contract month, the trading of the contract will be stopped and the physical delivery will be prepared. For example, the Chicago Board of Trade stipulates that the last trading day of corn, soybean, soybean meal, soybean oil and wheat futures is the seventh trading day from the last trading day of the delivery month.

other

Futures contracts also include terms such as delivery method, breach of contract and liquidated damages for breach of contract.

Futures listed varieties refer to the subject matter of futures contract transactions, such as corn, copper, oil, etc. Not all commodities are suitable for futures trading. Among many physical commodities, generally speaking, only commodities with the following attributes can be listed as futures contracts:

First, the price fluctuates greatly. Only when commodity prices fluctuate greatly, traders who intend to avoid price risks need to use forward prices to determine prices first. If the commodity price is basically unchanged, such as monopoly price or planned price. There is no need for commodity operators to use futures trading to fix prices or lock in costs.

Second, the supply and demand are large. The function of the futures market is based on the extensive participation of both the supply and demand sides of commodities. Only goods with large spot supply and demand can fully compete in a wide range and form authoritative prices.

Third, it is easy to classify and standardize. The quality standard of the delivered goods is stipulated in the futures contract in advance. Therefore, futures varieties must be commodities with stable quality, otherwise, it will be difficult to standardize.

Fourth, it is convenient for storage and transportation. Commodity futures are generally forward delivery commodities, which requires these commodities to be easy to store, not easy to deteriorate and easy to transport, so as to ensure the smooth delivery of futures.

According to the types of transactions, futures trading can be divided into commodity futures and financial futures. Physical commodities, such as corn, wheat, copper and aluminum, are all commodity futures. Financial products, such as exchange rate, interest rate and stock index, are regarded as financial futures. Generally, there are no quality problems in financial futures, and most of them are settled by cash and price difference. The listed varieties mainly include copper, aluminum, soybean, wheat and natural rubber. On April 6th, 2000, Shanghai and Shenzhen 300 stock index futures were successfully listed in CICC, which marked the beginning of China financial futures market.