What are Futures?

What are Futures?

In a futures or future contract, a buyer and a seller commit to purchasing from the other party, at a fixed price, a specified number of shares or an index in the future. The details of the contract are specifically documented at the time of entering the contract.

Since in futures contracts, the contract sizes and expiration dates are standardized, they may be freely traded on exchanges. A customer and a vendor can both remain anonymous.

Additionally, every contract is guaranteed and upheld by the stock exchange, or more precisely, by the clearing house or which is a body established to settle investor trades or any disputes arising in future contracts.







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