Unlike a stock, which represents equity in a company and can be held for a long time, futures contracts have finite lives.
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Investment Services : Commodity Futures & Options
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Futures Contracts
Futures contracts are standardized exchange traded contracts based on a specified asset of a specified quantity and grade for a price associated with delivery at a specified future date.
Unlike a stock, which represents equity in a company and can be held for a long time, futures contracts have finite lives. They are primarily used for hedging commodity price risks or for speculating on price movements in the underlying commodity (such as the price of wheat, gold, or a currency). Futures are traded in "contracts", which require the delivery of the commodity at a stated time (unless the contract is liquidated before). Futures contract listings have grown exponentially to include many alternative commodities such as weather, electricity, and more.
Futures contracts are traded on futures exchanges such as the Chicago Mercantile Exchange (CME) or the ICE Futures Canada in a similar fashion to stock markets.
A full list of futures exchanges and industry links can be found here (link to Industry Links page).
Commodities trading can involve significant financial risk and is not suitable for all investors.
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