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What Is Futures Contract?

Futures Contracts are derivative instruments that bind a buyer and a seller in an agreement to trade the underlying asset at a fixed price at a future date.

Apart from being an instrument that facilitates the trading of the underlying asset at a fixed price, futures contracts are written on more and more non-physical assets and even physical assets for the purpose of leveraged speculation. Futures contracts provide leverage due to the fact that only a fraction of the price of the underlying asset needs to be paid in order to speculate in the price movement of those asset.

Read the full tutorial on Futures Contracts.