Futures Contracts

03/22/2022 09:28 AM - By Matt Ratliff

Are you curious about Futures Contracts? Maybe there are reasons for you to consider adding Futures Contracts to your investing/trading strategy. Futures Contracts can deliver some interesting advantages over normal equity trading. Trading Futures Contracts is not without risks, including some very unique risks. Watch this video for more...

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What is a Futures Contract

A Futures Contract is a financial agreement between 2 parties to buy and sell a specific quantity of a standard asset at a specific price on a specific date in the future.

What can I buy/sell with a Futures Contract

There are many types of Futures Contracts you can buy or sell. Broadly they include Securities and Commodities. Popular Futures to trade are: the S&P 500, Crude Oil, 30 year Bond, and Corn.

Are there advantages?

There are several advantages to consider, including: tax treatment, liquidity, diversification, short selling, and leverage.

Do I really have to buy corn?

Good question. The answer is NO. You and I would never hold the contract until execution, rather we are speculating over shorter time periods. So we never actually execute the contract and take delivery of corn.