What is a commodity futures contract?

A commodity futures contract is an agreement to buy or sell a predetermined amount of a commodity at a specific price on a specific date in the future. Bond futures are financial derivatives which obligate the contract holder to purchase or sell a bond on a specified date at a predetermined price.

What is futures trading?

It is an agreement where prices derive from their underlying assets. Finally, futures trading is facilitated by futures contracts, commonly used by individual traders to make a profit or by corporations to lock in the prices of commodities they need for production and manufacturing.

What are the different types of futures markets?

Investors can trade futures to speculate or hedge on the price direction of a security, commodity, or financial instrument. Key futures markets include stock indexes, energy, currencies, cryptocurrencies, interest rates, grains, forestry, and livestock.

What types of assets can you trade with futures contracts?

There is no limit to the type of assets that investors can trade using these contracts. As such, they can trade the following futures: stocks, bonds, commodities (energy, grains, forestry, livestock, and agricultural products), currencies, interest rates, precious metals, and cryptocurrencies, among others.