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 starting to buy futures contracts or selling futures contracts is called "opening positions", the behavior of traders holding contracts is called "holding positions", and the reverse trading behavior of traders knowing that they have contracts is called "closing positions" or "hedging". If the contract in the hands of the trader is not hedged according to the delivery month, the short contract holder should prepare for physical delivery, and the long contract holder should prepare funds to accept physical delivery. Under normal circumstances, most contracts are settled by hedging before expiration, and only a few need physical delivery. Futures hedging. The basic principle of hedging 1. The concept of hedging: Hedging refers to the trading activities that use the futures market as a place to transfer price risk, use futures contracts as a temporary substitute for buying and selling commodities in the spot market in the future, and sell commodities after buying now or insure the prices of commodities that need to be bought in the future. 2. Basic characteristics of hedging: The basic practice of hedging is to buy and sell the same commodity in the spot market and the futures market at the same time in the same quantity but in the opposite direction, that is, to buy or sell the same quantity of futures in the futures market at the same time. After a period of time, when the price changes make the profit and loss in spot trading even, the losses in futures trading can be offset or compensated. Therefore, hedging mechanisms are established between "now" and "period" and between short-term and long-term to minimize price risk. 3. Logical principle of hedging: Hedging can be hedged because the main difference between futures and spot of the same specific commodity lies in the different delivery dates, and their prices are influenced and restricted by the same economic and non-economic factors. Moreover, the futures contract must be delivered in kind when it expires, which makes the spot price and futures price converge, that is, when the futures contract approaches the expiration date, the difference between the two prices is close to zero, otherwise arbitrage will occur. In two related markets, the reverse operation will inevitably produce the effect of mutual cancellation. 2. The method of hedging 1. Selling hedging of producers: As a supplier of social goods, both farmers who provide agricultural and sideline products to the market and enterprises that provide basic raw materials such as copper, tin, lead and oil can adopt selling hedging transactions in order to ensure that the goods they have produced or will sell to the market in the future can obtain reasonable economic profits in the production process and prevent losses caused by possible price drop when they are officially sold. 2. The operator sells hedging: For the operator, the market risk he faces is that the price of the goods falls after purchase but is not resold, which will reduce his operating profit and even cause losses. In order to avoid this market risk, operators can use the method of selling hedging to carry out price insurance. 3. Comprehensive hedging of processors: For processors, market risk comes from buying and selling. He is worried about rising raw material prices and falling finished product prices, and even more afraid of rising raw material and finished product prices. As long as the materials and finished products that the processor needs can be traded in the futures market, he can use the futures market for comprehensive hedging, that is, buying the purchased raw materials and selling the products, which can relieve his worries and lock in his processing profits, thus specializing in processing and production. Three. The role of enterprises is the cell of social economy. What to produce, how much to produce and how to operate with the resources it owns or grasps are not only directly related to the production economic benefits of the enterprise itself, but also related to the rational allocation of social resources and the improvement of social economic benefits. The key to the correctness of enterprise's production and management decision lies in whether it can correctly grasp the market supply and demand state, especially whether it can correctly grasp the next changing trend of the market. The establishment of the futures market not only enables enterprises to obtain the supply and demand information of the future market through the futures market, but also improves the scientific rationality of the enterprise's production and operation decision-making, and truly determines the production on demand. It also provides a place for enterprises to avoid market price risks through hedging, which plays an important role in improving the economic benefits of enterprises. Four. Hedging strategy In order to better achieve the purpose of hedging, enterprises must pay attention to the following procedures and strategies when conducting hedging transactions. (1) Adhere to the principle of "equality and relative". "Equality" means that the commodities traded in futures must be the same as those traded in the spot market in terms of types or related quantities. "Relative" refers to the opposite buying and selling behavior in two markets, such as buying in the spot market, selling in the futures market, or vice versa; (2) Spot transactions with certain risks should be selected for hedging. If the market price is relatively stable, there is no need to hedge, and the hedging transaction needs a certain fee; (3) Comparing the net risk amount with the hedging cost, and finally determining whether to hedge; (4) According to the short-term price trend forecast, calculate the expected change of basis (that is, the difference between spot price and futures price), and make the timing plan for entering and leaving the futures market accordingly, and implement it. 5. Example of hedging 1 Buying hedging: (also known as long hedging) is to buy futures in the futures market, and use long positions in the futures market to ensure short positions in the spot market to avoid the risk of rising prices. For example, in March, the oil factory planned to buy 65,438+000 tons of soybeans two months later. At that time, the spot price was 2200 yuan per ton, and the futures price in May was 2300 yuan per ton. Worried about rising prices, the factory bought100t soybean futures. In May, the spot price really rose to 2400 yuan per ton, while the futures price was 2500 yuan per ton. The factory then bought the spot, with a loss of 0.02 million yuan per ton; At the same time, the futures were sold, and the profit per ton was 0.02 million yuan. The two markets break even, effectively locking in costs. 2. Selling hedging: (also known as short hedging) is to sell futures in the futures market, and use short positions in the futures market to ensure long positions in the spot market, thus avoiding the risk of falling prices. Example: In May, the supply and marketing company signed a contract with the rubber tire factory to sell natural rubber 100 tons in August, and the futures price in August was RMB 0.25 million per ton/kloc-0. The supply and marketing company was worried about falling prices, so it sold 100 tons of natural rubber futures. In August, the spot price dropped to per ton 1. 1 ten thousand yuan. The company sold the spot and lost 0. 1 ten thousand yuan per ton; He also bought1.100 tons of futures at a price of 0. 1.5 million yuan per ton, with a profit of 0.1.5 million yuan per ton. The two markets break even, effectively preventing the risk of falling natural rubber prices. References:

Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.