Judging from the historical process. Futures trading is developed from spot trading. In Antwerp, Belgium in the13rd century, Amsterdam, the Netherlands in the17th century and Osaka, Japan in the18th century, the embryonic form of futures trading has appeared. Modern organized futures trading originated in Chicago, USA. 1848, Chicago Board of Trade (CBOT) began to engage in forward trading of agricultural products. In order to avoid the risk of sharp fluctuation of agricultural products prices, farmers, agricultural products traders and processors have adopted spot forward contracts for commodity exchange from the beginning to stabilize supply and marketing and reduce the risk of price fluctuation. With the expansion of trading scale, some disadvantages in spot forward contract trading are gradually exposed. First, the spot forward contract is not standardized, and each transaction requires both parties to re-sign, which increases the transaction cost and reduces the transaction efficiency. Second, due to the variety of contents and terms of forward contracts, a specific contract cannot be widely recognized, which makes it difficult to transfer the contract smoothly and reduces the liquidity of the contract. Third, the performance of forward contracts is based on the credit of both parties to the transaction, which is prone to default. Fourth, the price of forward contracts is not widely representative and is not a reasonable expected price recognized by the market. Therefore, the early Chicago Board of Trade often had trading disputes and defaults, which greatly restricted commodity trading and restricted market development. In order to reduce trading disputes, simplify trading procedures, enhance contract liquidity and improve market efficiency, Chicago Board of Trade introduced standardized futures contract trading at 1865, replacing the original spot forward contract trading, and then introduced performance bond system and unified settlement system.
Compared with spot trading, the main features of futures trading are:
(1) Futures contracts are contracts made by exchanges and traded on futures exchanges.
(2) Futures contracts are standardized contracts. All the terms in the contract, such as the quantity, quality, margin ratio, delivery place, delivery method and transaction method, are standardized, and only the price in the contract is a free price formed through market bidding transactions.
(3) The physical delivery rate is low. The conclusion of a futures contract does not have to fulfill the obligation of actual delivery. People who buy and sell futures contracts can offset each other at any time through transactions with the same quantity and opposite directions before the specified delivery date, without fulfilling the obligation of actual delivery. Therefore, the proportion of physical delivery in futures trading is very small, generally less than 5%.
(four) the futures trading margin system. The trader does not need to pay the full loan equal to the contract amount, but only needs to pay the performance bond of 3% ~ 15%.
(5) The futures exchange provides clearing and delivery services and performance guarantees for both parties to the transaction, and implements a strict clearing and delivery system, with little risk of default.
Second, what is option trading?
Option is a kind of option. After paying a certain amount of royalties to the seller, the buyer of the option obtains this right, that is, the right to sell or buy a certain number of subject matter (physical objects, securities or futures contracts) at a certain price (exercise price) within a certain period of time. When the buyer of the option exercises his rights, the seller must fulfill the obligations stipulated by option contracts. On the contrary, the buyer can give up exercising his rights. At this time, the buyer only lost royalties, and at the same time. Sellers earn royalties. In short, the buyer of the option has the right to exercise the option, but has no obligation to exercise it; The seller of the option only has the obligation to fulfill the option.
Options mainly include the following factors: ① exercise price (also called exercise price). The buying and selling price of the subject matter specified in advance when the buyer of the option exercises his rights. Royalties. Option price paid by the option buyer, that is, the fee paid by the buyer to the option seller for obtaining the option. ③ Performance bond. Option sellers must deposit performance bonds, ④ call options and put options on the exchange. Call option refers to the right to buy a certain number of subject matter at the execution price within the validity period of the option contract; Put option refers to the right to sell the subject matter. When the option buyer expects the target price to exceed the strike price, he will buy a call option, and vice versa.
According to the different execution time, options can be mainly divided into two types, European options and American options. European option refers to the option that can only be exercised on the expiration date of the contract, which is adopted in most OTC transactions. American option refers to any option that can be executed within the validity period after trading, which is mostly adopted by floor exchanges.
3. What is a futures exchange?
A futures exchange is a place that specializes in trading futures contracts. Generally speaking, it is a membership system, that is, it is jointly established by members, and each member enjoys the same rights and obligations. Exchange members have the right to directly participate in the transactions of the exchange, and must abide by the rules of the exchange, pay membership fees and fulfill their due obligations.
Membership futures exchange is a non-profit-making economic organization, which mainly relies on collecting transaction fees to maintain the expenses of trading facilities and employees. The savings can only be used for expenses directly related to the transaction, and shall not be used for other investments or profit distribution. The purpose of the futures exchange is to provide facilities and services for futures trading. It does not own any commodities, buy or sell futures contracts or participate in the formation of futures prices.
4. What is a futures margin?
In the futures market, traders can pay a small amount of money according to a certain proportion of the price of futures contracts as financial guarantee for the performance of futures contracts and participate in the trading of futures contracts. This kind of money is the futures margin.
In China, futures margin (hereinafter referred to as margin) varies according to its nature and function. It can be divided into two categories: settlement reserve and trading margin. Settlement reserve is generally paid by member units to the exchange according to fixed standards, and prepared in advance for transaction settlement. Trading margin refers to the actual margin paid by member companies or customers for holding futures contracts in futures trading, which is divided into initial margin and additional margin.
Initial margin is the money that traders need to pay when they open new positions. According to the transaction amount and margin ratio, that is, initial margin = transaction amount and margin ratio. At present, the minimum margin ratio in China is 5% of the transaction amount, which is generally between 3% and 8% internationally. For example, the soybean margin ratio of Dalian Commodity Exchange is 5%. When a customer buys five soybean futures contracts (each 10 ton) at a price of 2,700 yuan/ton, he needs to pay an initial deposit of 6 750 yuan (i.e. 2700x50x5%%) to the exchange.
In the process of holding positions, traders will have floating profits and losses (the difference between settlement price and transaction price) due to the constant changes of market conditions, so the funds actually available in the margin account can be increased or decreased at any time. Floating profit will increase the balance of margin account, while floating loss will decrease the balance of margin account. The minimum balance that must be kept in the margin account is called maintenance margin. Maintenance margin: the settlement price is adjusted to the position, and the margin ratio is adjusted to xk(k is a constant, which is called the maintenance margin ratio, which is usually 0.75 in China). When the book balance of the margin is lower than the maintenance margin, the trader must make up the margin within the specified time to make the margin account balance (settlement price x position x margin ratio), otherwise the exchange or institution has the right to carry out compulsory liquidation on the next trading day. This part of the margin that needs to be replenished is called additional margin. Still according to the above example, suppose that on the third day after the customer bought 50 tons of soybeans at a price of 2700 yuan/ton, the settlement price of soybeans fell to 2600 yuan/ton. Due to the sharp drop in prices, the floating loss of customers is 5000 yuan (that is,