What are the 4 types of futures contract?

Types of Futures include Commodity Futures. A futures contract's value is derived from an underlying asset, which in the case of commodity futures, can be agricultural products, metals, or energy sources.

Stock Futures allow investors to trade contracts based on the future value of stocks. These contracts can be used to speculate on stock prices or to hedge against potential losses in a portfolio. Stock futures can provide a means to diversify an investment portfolio and to manage risk.

Commodity Futures provide investors with the opportunity to hedge against price fluctuations in the commodity markets. By entering into a futures contract, investors can lock in a price for a future delivery of a commodity, mitigating the risk of adverse price movements.

Index Futures are futures contracts based on the value of a stock index. By trading index futures, investors can gain exposure to the overall market or to a specific sector, without having to purchase individual stocks. Index futures can be a useful tool for portfolio management and risk mitigation.

Currency Futures are another type of futures contract. These contracts allow investors to speculate on the future value of currencies or to hedge against exchange rate risk. Understanding currency futures can open up new investment opportunities and provide a means to protect international investments.