Futures Contract

What is Futures Contract?

Futures Contract meaning An agreement to purchase or sell a commodity for delivery in the future: (1) at a price that is determined at initiation of the contract; (2) that obligates each party to the contract to fulfill the contract at the specified price; (3) that is used to assume or shift price risk; and (4) that may be satisfied by delivery or offset.

 

reference: U.S. COMMODITY FUTURES TRADING COMMISSION – CFTC Glossary