Futures contract
A futures contract is a standardised agreement traded on an exchange to buy or sell a specified asset at an agreed price for a future delivery or settlement date. Futures generally require margin and are marked to market daily, with physical delivery or cash settlement determined by contract rules.
In a hypothetical example, a trader buys a crude oil futures contract, then closes the position before delivery by selling an identical contract.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Glossary definitions are general education only and are not investment advice. Risk disclosure