Futures contract
A futures contract is an exchange-traded agreement to buy or sell at a set price on a set date, settled daily against margin. It binds both sides, and at expiry it converges to the real price, which the Module 0 quiz checks. Futures began on rice at Dojima and grain in Chicago, and index futures are the US market price overnight.
Educational content only. Not investment advice.
MochaLearn is a free A to Z course on understanding and trading US stocks and commodities, built for Indian traders.
Go on
In the help centreSee how leverage and margin work on MochatradeRelated terms
- Index futures (E-mini S&P 500)Index futures are futures on a stock index, like the E-mini S&P 500 on the CME. They trade almost round the clock, so…
- Options contractAn options contract gives the buyer the right, not the obligation, to buy (call) or sell (put) at a strike before…
- Strike price and expiryThe strike price is where an option pays; expiry is when a contract ends. Expiry is what ties a future to the real…
- Leverage ratioThe leverage ratio is position value divided by margin: ₹50,000 on ₹10,000 is 5x. One over the ratio is how far the…
- Call optionA call option is the right to buy at the strike before expiry. Strike 24,200 and premium 80 means profit only above…
- Perpetual futuresPerpetual futures are contracts that track an asset's price with no expiry date. Expiry is what pulls a normal future…
Educational content only. Not investment advice. Leveraged products magnify losses as well as gains.