Commodity Futures
Futures contracts where the underlying asset is a physical commodity.
Detailed Description
Commodity Futures
What are commodity futures?
Commodity futures are standardized contracts obligating the buyer to purchase and the seller to sell a specific quantity of a commodity at a predetermined price on a future date.
What are the key features of commodity futures?
Key features include standardization, leverage, and a defined expiration date for contracts.
What are the two main types of commodity futures?
The two main types are hard commodities (like gold and oil) and soft commodities (like wheat and coffee).
How do traders profit from commodity futures?
Traders can profit by closing their positions if the futures price moves favorably before expiration.
What regulatory body oversees commodity futures trading in the U.S.?
The Commodity Futures Trading Commission (CFTC) oversees futures markets in the United States.