What is a futures market?

A futures market is a market in which traders buy and sell futures contracts. Futures markets are also called futures exchanges. Traders use futures exchanges to hedge against price volatility and speculate on the future prices of stock indexes, currencies, commodities, interest rates and other assets.

When do futures expire?

Futures are identified by their expiration month. For example, a December gold futures contract expires in December. Traders and investors use the term futures in reference to the overall asset class. However, there are many types of futures contracts available for trading including:

What is a futures speculator?

Futures contracts are traded on futures exchanges and are used for both hedging and price speculation. Most futures speculators sell or offset their contracts prior to expiration so they are not forced to accept physical delivery of the underlying asset.

Are Futures a good investment?

Futures are an easy way to diversify any investment portfolio or simply speculate on price moves in stock indexes, commodities or other asset classes. Futures contracts also provide investors with pure-play access to commodities and markets that they can't otherwise access via the stock market.