Why Invest in Futures Trading Information?
Learn about futures trading information. First of all, why invest in futures contracts?
Hedging – to reduce risk. Example: a flour miller might use a futures contract to set a price now for wheat that he knows he will need to purchase in the future, rather than face the chance that prices could be even higher when he buys the wheat.
Speculating – this is when a person tries to make a profit by predicting the direction a market will move and opening a contract related to the underlying asset.
Futures Contract vs. Options Contract – A futures contract gives the holder the obligation to make or take delivery under the terms of the contract, with options the buyer has the right, but not the obligation, to exercise the option.
