Financial futures

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Financial futures are futures contracts on a financial product, as opposed to (for example) a physical commodity like wheat, coffee, gold or pork bellies. Financial futures include futures on currencies, stock indices, and Treasury securities.[1]

As in other futures contracts, the counterparties agree to trade the underlying financial product at a certain time for a certain price. Some financial futures are settled in cash, especially if the underlying assets are indices.


References

  1. Financial Futures: Between a Business and Its Global Consumers. FuturesFundamentals.org.