To comprehend what futures trading entails, you must first comprehend what
derivatives trading entails.
Derivatives are financial contracts whose value is based on the movement of the
price of another financial item. A derivative’s price is linked to the price of the
asset from which it derives its value.
A futures contract is an agreement between a buyer (with a long position) and a
seller (with a short position) in which the buyer commits to buy a derivative or
index at a fixed price at a future date.
The contract’s price changes over time in relation to the fixed price at which the
transaction was made, resulting in a profit or loss for the trader. We’re here for
the profit.
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