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Commodity_Futures_Tradings

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					Title:
Commodity Futures Tradings


Word Count:
314


Summary:
Compared to cash contracts, which require payment against the physical delivery of goods immediately or
after a specified period, a futures contract is a special type of agreement made strictly under the rules of a
commodity exchange, which may or may not call for the actual delivery of goods and payment in cash on a
future date.



Keywords:
Futures Trading, Online Futures Tradings, Futures Trading Software, Commodity Futures Tradings



Article Body:
Compared to cash contracts, which require payment against the physical delivery of goods immediately or
after a specified period, a futures contract is a special type of agreement made strictly under the rules of a
commodity exchange, which may or may not call for the actual delivery of goods and payment in cash on a
future date.


According to Emery, a futures contract can be defined as a contract for the future delivery of some
commodity without reference to specific lots, made under the rules of some commercial body, in a set form,
by which the conditions as to unit of amount, the quality and time of delivery are stereotyped, and only the
determination of the total amounts and the price is left open to the contracting parties.


Such contracts are meant exclusively for future settlement, though the exact date of the settlement is decided
by reference to the wishes of the seller and the established rules of the commodity exchange. Such contracts
do not specify the particular grade of a commodity, but impliedly refer to a basic grade called the contract
grade, accepted as the common grade for all futures dealings. The details in respect to the amount, the time
of settlement, the quality and so forth are mentioned in the rules and regulations, and are common to all such
contracts. The contracting parties have to decide upon the price at which the contract is to be settled,
sometime in one of the trading months specified by the exchange.


Futures contracts are made only in the ‘ring’ of the commodity exchanges, and not outside the exchanges.
Only members of a commodity exchange can enter into such a deal. No outsider can become a party to a
futures agreement. Such contracts can be made only in multiples of a fixed unit of trading. No such contracts
can be made in fractions of these units.
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Nikola Paborsky Nikola Paborsky Mr http://insuracebuffs.com
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