Futures Contract
/ˈfjuːtʃərz ˈkɒntrækt/
Definitions
- (n.) A standardized legal agreement to buy or sell a specified asset at a predetermined price at a specified time in the future on a futures exchange.
The trader entered into a futures contract to purchase 1,000 barrels of oil in three months.
Forms
- futures contracts
Related terms
See also
Commentary
Futures contracts differ from forward contracts by being standardized and exchange-traded, which reduces counterparty risk.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.