YOU ASK:
What is the definition of Futures?
WE ANSWER:
Futures refer to a financial agreement or contract where one party (the buyer) promises to buy an asset that the seller promises to sell at a specified date.
Futures usually involve financial futures, commodities ad indexes. The agreement outlines the amount and quality of the underlying asset. There are some futures contracts that settle the contract while some ask for the asset's physical delivery (but these instances re actually rare).
The advantage of futures is that it gives traders leverage, as compared to stock markets. Futures are also used as a hedge and also to speculate. This speculation is based on the price movements of the underlying assets.
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