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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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posted:7/30/2013
language:English
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Marijan Stefanovic Marijan Stefanovic Digital Imagery http://proart-13.blogspot.com/
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