{"id":8685,"date":"2025-06-27T12:48:28","date_gmt":"2025-06-27T07:18:28","guid":{"rendered":"https:\/\/www.torusdigital.com\/toruscope\/?p=8685"},"modified":"2025-08-08T15:13:40","modified_gmt":"2025-08-08T09:43:40","slug":"what-are-different-types-of-futures","status":"publish","type":"post","link":"https:\/\/www.torusdigital.com\/toruscope\/futures-and-options-trading\/what-are-different-types-of-futures\/","title":{"rendered":"Understanding Different Types of Futures Contracts"},"content":{"rendered":"<div class=\"wpb-content-wrapper\"><p><span style=\"font-weight: 400;\">Futures contracts have become an integral part of global financial markets. Whether you&#8217;re a trader, investor, or someone curious about how the <\/span><a href=\"https:\/\/www.torusdigital.com\/share-market-today\"><b>stock market<\/b><\/a><span style=\"font-weight: 400;\"> operates, understanding the <\/span><b>types of futures<\/b><span style=\"font-weight: 400;\"> is essential. These contracts allow individuals and institutions to <\/span><b>buy or sell<\/b><span style=\"font-weight: 400;\"> an asset at a fixed price on a specific future date.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">They are widely used not only for speculation but also for hedging against price volatility. From <\/span><b>crude oil<\/b><span style=\"font-weight: 400;\"> to <\/span><b>interest rates<\/b><span style=\"font-weight: 400;\"> to <\/span><b>market index<\/b><span style=\"font-weight: 400;\"> derivatives, there are numerous ways traders can use futures. In this blog, we&#8217;ll explore the <\/span><b>different types of futures<\/b><span style=\"font-weight: 400;\">, how they are traded, and address some of the most common FAQs surrounding the subject.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Various_Futures_Contract_Types_Explained\"><\/span><span style=\"font-weight: 400;\">Various Futures Contract Types Explained<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The world of futures is diverse, offering a range of contracts based on underlying assets. Below are some of the most common <\/span><b>types of futures<\/b><span style=\"font-weight: 400;\"> traded in global markets:<\/span><\/p>\n<ol>\n<li><b> Commodity Futures<\/b><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">Commodity futures are perhaps the oldest and most well-known form of futures contracts. These are agreements to buy or sell a physical commodity at a predetermined price. Popular examples include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Crude Oil Futures<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Gold and Silver Futures<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Agricultural Futures<\/b><span style=\"font-weight: 400;\"> (wheat, corn, soybeans)<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Natural Gas Futures<\/b><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">These contracts help producers, manufacturers, and traders protect themselves against unexpected <\/span><b>price movements<\/b><span style=\"font-weight: 400;\"> in raw materials.<\/span><\/p>\n<ol start=\"2\">\n<li><b> Currency Futures<\/b><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">Also known as foreign exchange futures, these contracts allow traders to lock in the exchange rate for a currency pair at a future date.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Commonly traded pairs include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">USD\/INR<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">EUR\/USD<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">GBP\/JPY<\/span><\/li>\n<\/ul>\n<p><b>Currency futures<\/b><span style=\"font-weight: 400;\"> are widely used by importers, exporters, and multinational businesses to hedge against foreign exchange risk.<\/span><\/p>\n<ol start=\"3\">\n<li><b> Interest Rate Futures<\/b><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">As the name suggests, <\/span><b>interest rate futures<\/b><span style=\"font-weight: 400;\"> are contracts based on the expected movement of interest rates. These can be tied to instruments like:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Government bonds (e.g., US Treasury Bonds)<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Short-term interest rates (e.g., LIBOR or SOFR)<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">These contracts are mostly used by banks, financial institutions, and fund managers to manage interest rate exposure.<\/span><\/p>\n<ol start=\"4\">\n<li><b> Stock Index Futures<\/b><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">Instead of focusing on individual <\/span><a href=\"https:\/\/www.torusdigital.com\/stocks\"><b>stocks,<\/b><\/a><span style=\"font-weight: 400;\"> these futures track a <\/span><b>market index<\/b><span style=\"font-weight: 400;\"> such as:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"https:\/\/www.torusdigital.com\/indices\/nifty-50\"><strong>Nifty 50<\/strong><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">S&amp;P 500<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Dow Jones Industrial Average<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">They are ideal for traders who want to speculate on the overall direction of the market or hedge a portfolio without trading individual securities.<\/span><\/p>\n<ol start=\"5\">\n<li><b> Single Stock Futures<\/b><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">These contracts are based on individual company stocks. For example, you could trade futures on companies like <a href=\"https:\/\/www.torusdigital.com\/stocks\/tata-motors-ltd-share-price\"><strong>Tata Motors<\/strong><\/a>, <a href=\"https:\/\/www.torusdigital.com\/stocks\/infosys-ltd-share-price\"><strong>Infosys<\/strong><\/a>, or <a href=\"https:\/\/www.torusdigital.com\/stocks\/reliance-industries-ltd-share-price\"><strong>Reliance Industries<\/strong><\/a>.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">They allow leveraged trading on individual shares without owning the stock.<\/span><\/p>\n<ol start=\"6\">\n<li><b> Financial Futures<\/b><\/li>\n<\/ol>\n<p><span style=\"font-weight: 400;\">A broader category that includes <\/span><b>interest rate futures<\/b><span style=\"font-weight: 400;\">, <\/span><b>currency futures<\/b><span style=\"font-weight: 400;\">, and <\/span><b>stock index futures<\/b><span style=\"font-weight: 400;\">. These contracts are used for hedging financial risk and for speculating on macroeconomic changes like inflation, policy decisions, and global events.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">These <\/span><b>types of futures trading<\/b><span style=\"font-weight: 400;\"> can serve a wide range of objectives, from risk management to profit generation, depending on how well the trader understands the market mechanics.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Trading_in_Futures\"><\/span><span style=\"font-weight: 400;\">Trading in Futures<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Futures contracts are traded on regulated exchanges such as the <\/span><b>Chicago Mercantile Exchange (CME)<\/b><span style=\"font-weight: 400;\">, <\/span><b>Intercontinental Exchange (ICE)<\/b><span style=\"font-weight: 400;\">, and in India, the <\/span><b>National Stock Exchange (NSE)<\/b><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><b>Here&#8217;s how the process works:<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Opening a Trading Account<\/b><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">To start trading, you need to <a href=\"https:\/\/www.torusdigital.com\/open-trading-account\"><strong>open a trading account<\/strong><\/a> with a broker who has access to futures markets.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Margin Requirements<\/b><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Futures trading requires an <\/span><b>initial margin<\/b><span style=\"font-weight: 400;\">, which is a fraction of the full contract value. This makes it a leveraged product, amplifying both gains and losses.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Order Execution<\/b><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Orders can be placed to <\/span><b>buy or sell<\/b><span style=\"font-weight: 400;\"> based on your market view. You can take a <\/span><b>long position<\/b><span style=\"font-weight: 400;\"> if you expect prices to rise or a <\/span><b>short position<\/b><span style=\"font-weight: 400;\"> if you expect prices to fall.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Daily Settlement<\/b><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Futures are <\/span><b>settled daily<\/b><span style=\"font-weight: 400;\"> through a process called <\/span><b>mark-to-market<\/b><span style=\"font-weight: 400;\">, where gains or losses are calculated and credited or debited to your account at the end of each trading day.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Contract Expiry and Settlement<\/b><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Contracts have expiry dates. Some are <\/span><b>cash-settled<\/b><span style=\"font-weight: 400;\">, while others may involve <\/span><b>physical delivery<\/b><span style=\"font-weight: 400;\"> of the underlying asset.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Futures markets are typically more liquid and standardised compared to other derivatives, making them attractive for institutional and retail investors alike.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><span style=\"font-weight: 400;\">Conclusion<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Understanding the <\/span><b>different <\/b><b>types of futures<\/b><span style=\"font-weight: 400;\"> helps traders and investors make informed decisions in complex markets. Whether you&#8217;re trading in <\/span><b>financial futures<\/b><span style=\"font-weight: 400;\">, <\/span><b>commodity contracts<\/b><span style=\"font-weight: 400;\">, or speculating on <\/span><b>currency futures<\/b><span style=\"font-weight: 400;\">, each category offers its own set of risks and rewards.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Futures can be powerful tools if used correctly, but due to their leveraged nature and volatility, they also require caution and expertise. Before diving in, ensure you understand not just the <\/span><span style=\"font-weight: 400;\">types of futures<\/span><span style=\"font-weight: 400;\"> available but also how these instruments behave in various market conditions.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Frequently_Asked_Questions_FAQs\"><\/span><span style=\"font-weight: 400;\">Frequently Asked Questions (FAQs)<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h3><span class=\"ez-toc-section\" id=\"What_does_a_futures_contract_mean\"><\/span><span style=\"font-weight: 400;\">What does a futures contract mean?<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">A futures contract is a legal agreement to buy or sell an underlying asset at a fixed price on a specific future date. These contracts are standardised and traded on recognised exchanges.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h3><span class=\"ez-toc-section\" id=\"What_types_of_futures_contracts_exist\"><\/span><span style=\"font-weight: 400;\">What types of futures contracts exist?<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">There are several <\/span><b>types of futures<\/b><span style=\"font-weight: 400;\">, including commodity futures, currency futures, interest rate futures, stock index futures, single stock futures, and financial futures. Each serves a unique purpose and is suited for different kinds of investors and traders.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h3><span class=\"ez-toc-section\" id=\"Can_you_provide_an_example_of_a_futures_contract\"><\/span><span style=\"font-weight: 400;\">Can you provide an example of a futures contract?<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">An example would be a <\/span><b>crude oil<\/b><span style=\"font-weight: 400;\"> futures contract where a buyer agrees to purchase 1,000 barrels of oil at \u20b96,000 per barrel on a date three months in the future. If prices rise to \u20b96,500, the buyer can profit from the difference without actually taking delivery of the oil.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h3><span class=\"ez-toc-section\" id=\"How_does_futures_trading_work\"><\/span><span style=\"font-weight: 400;\">How does futures trading work?<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Futures are traded on formal exchanges using margin-based trading. Traders deposit an <\/span><b>initial margin<\/b><span style=\"font-weight: 400;\"> to open positions and must maintain a minimum balance to keep them active. Prices are settled daily, and contracts can be closed or rolled over before expiry.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\">\n<h3><span class=\"ez-toc-section\" id=\"Are_futures_contracts_settled_on_a_daily_basis\"><\/span><span style=\"font-weight: 400;\">Are futures contracts settled on a daily basis?<\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Yes, futures are <\/span><b>settled daily<\/b><span style=\"font-weight: 400;\"> using the <\/span><b>mark-to-market<\/b><span style=\"font-weight: 400;\"> method. This ensures that gains and losses are realised each day, adding transparency and managing credit risk in the system.<\/span><\/p>\n<p><script type=\"application\/ld+json\">{\"@context\":\"https:\/\/schema.org\",\"@type\":\"BlogPosting\",\"mainEntityOfPage\":{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.torusdigital.com\/toruscope\/futures-and-options-trading\/what-are-different-types-of-futures\/\"},\"headline\":\"Different Types of Futures Contracts: Explained with Key Examples\",\"description\":\"Explore different types of futures contracts like stock, index, commodity and currency futures. Learn how each works and where they are used.\",\"image\":\"https:\/\/www.torusdigital.com\/toruscope\/wp-content\/uploads\/2025\/06\/What-are-different-types-of-futures.webp\",\"author\":{\"@type\":\"Organization\",\"name\":\"Torus Digital\",\"url\":\"https:\/\/www.torusdigital.com\/\"},\"publisher\":{\"@type\":\"Organization\",\"name\":\"Torus Digital\",\"logo\":{\"@type\":\"ImageObject\",\"url\":\"https:\/\/dl4mfd6uvl13t.cloudfront.net\/static\/images\/webp\/logo.webp\"}},\"datePublished\":\"27-06-2025\",\"dateModified\":\"08-08-2025\"}<\/script><script type=\"application\/ld+json\">{\"@context\":\"https:\/\/schema.org\/\",\"@type\":\"BreadcrumbList\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.torusdigital.com\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Toruscope\",\"item\":\"https:\/\/www.torusdigital.com\/toruscope\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Futures and Options Trading\",\"item\":\"https:\/\/www.torusdigital.com\/toruscope\/futures-and-options-trading\/\"},{\"@type\":\"ListItem\",\"position\":4,\"name\":\"Understanding Different Types of Futures Contracts\",\"item\":\"https:\/\/www.torusdigital.com\/toruscope\/futures-and-options-trading\/what-are-different-types-of-futures\/\"}]}<\/script><script type=\"application\/ld+json\">{\"@context\":\"https:\/\/schema.org\",\"@type\":\"FAQPage\",\"mainEntity\":[{\"@type\":\"Question\",\"name\":\"What does a futures contract mean?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"A futures contract is a legal agreement to buy or sell an underlying asset at a fixed price on a specific future date. These contracts are standardised and traded on recognised exchanges.\"}},{\"@type\":\"Question\",\"name\":\"What types of futures contracts exist?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"There are several types of futures, including commodity futures, currency futures, interest rate futures, stock index futures, single stock futures, and financial futures. Each serves a unique purpose and is suited for different kinds of investors and traders.\"}},{\"@type\":\"Question\",\"name\":\"Can you provide an example of a futures contract?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"An example would be a crude oil futures contract where a buyer agrees to purchase 1,000 barrels of oil at \u20b96,000 per barrel on a date three months in the future. If prices rise to \u20b96,500, the buyer can profit from the difference without actually taking delivery of the oil.\"}},{\"@type\":\"Question\",\"name\":\"How does futures trading work?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Futures are traded on formal exchanges using margin-based trading. Traders deposit an initial margin to open positions and must maintain a minimum balance to keep them active. Prices are settled daily, and contracts can be closed or rolled over before expiry.\"}},{\"@type\":\"Question\",\"name\":\"Are futures contracts settled on a daily basis?\",\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Yes, futures are settled daily using the mark-to-market method. This ensures that gains and losses are realised each day, adding transparency and managing credit risk in the system.\"}}]}<\/script><meta property=\"og:title\" content=\"Different Types of Futures Contracts: Explained with Key Examples\"><meta property=\"og:site_name\" content=\"Torus Digital\"><meta property=\"og:url\" content=\"https:\/\/www.torusdigital.com\/toruscope\/futures-and-options-trading\/what-are-different-types-of-futures\/\"><meta property=\"og:description\" content=\"Explore different types of futures contracts like stock, index, commodity and currency futures. 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Learn how each works and where they are used.\"><meta name=\"twitter:image\" content=\"https:\/\/www.torusdigital.com\/toruscope\/wp-content\/uploads\/2025\/06\/What-are-different-types-of-futures.webp\"><\/p>\n\n    <div class=\"cscra-social square cscra-socials-679c8a1122c00\">\n        <a href=\"\/\/www.facebook.com\/sharer\/sharer.php?u=https%3A%2F%2Fwww.torusdigital.com%2Ftoruscope%2Ffutures-and-options-trading%2Fwhat-are-different-types-of-futures%2F&t=Understanding+Different+Types+of+Futures+Contracts\" class=\"facebook\" data-toggle=\"tooltip\" data-placement=\"top\" title=\"Share On Facebook\" target=\"_blank\"><i class=\"fa fa-facebook\"><\/i><\/a>\n        <a href=\"\/\/twitter.com\/intent\/tweet?text=Understanding+Different+Types+of+Futures+Contracts&url=https%3A%2F%2Fwww.torusdigital.com%2Ftoruscope%2Ffutures-and-options-trading%2Fwhat-are-different-types-of-futures%2F\" class=\"twitter\" data-toggle=\"tooltip\" data-placement=\"top\" title=\"Share On Twitter\" target=\"_blank\"><i class=\"fa-brands fa-x-twitter\"><\/i><\/a>\n        <a href=\"https:\/\/api.whatsapp.com\/send?text=Understanding+Different+Types+of+Futures+Contracts - https%3A%2F%2Fwww.torusdigital.com%2Ftoruscope%2Ffutures-and-options-trading%2Fwhat-are-different-types-of-futures%2F\" class=\"whatsapp\" data-toggle=\"tooltip\" data-placement=\"top\" title=\"Share On WhatsApp\" target=\"_blank\"><i class=\"fa fa-whatsapp\"><\/i><\/a>\n        <a href=\"\/\/www.linkedin.com\/shareArticle?mini=true&url=https%3A%2F%2Fwww.torusdigital.com%2Ftoruscope%2Ffutures-and-options-trading%2Fwhat-are-different-types-of-futures%2F&title=Understanding+Different+Types+of+Futures+Contracts\" class=\"linkedin\" data-toggle=\"tooltip\" data-placement=\"top\" title=\"Share On Linkedin\" target=\"_blank\"><i class=\"fa fa-linkedin\"><\/i><\/a>\n    <\/div>\n<p>[vc_row_inner el_id=&#8221;faq_blog&#8221;][vc_column_inner][vc_custom_heading text=&#8221;Frequently Asked Questions&#8221; font_container=&#8221;tag:h2|text_align:left|color:%23001316&#8243; use_theme_fonts=&#8221;yes&#8221; css=&#8221;&#8221;][\/vc_column_inner][\/vc_row_inner][vc_tta_accordion active_section=&#8221;1&#8243; el_id=&#8221;faq&#8221;][vc_tta_section title=&#8221;What does a futures contract mean?&#8221; tab_id=&#8221;1743190878073-d3df1fa4-9993&#8243;][vc_column_text css=&#8221;&#8221;]A futures contract is a legal agreement to buy or sell an underlying asset at a fixed price on a specific future date. These contracts are standardised and traded on recognised exchanges.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=&#8221;What types of futures contracts exist?&#8221; tab_id=&#8221;1743197165963-423ff346-a92d&#8221;][vc_column_text css=&#8221;&#8221;]There are several types of futures, including commodity futures, currency futures, interest rate futures, stock index futures, single stock futures, and financial futures. Each serves a unique purpose and is suited for different kinds of investors and traders.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=&#8221;Can you provide an example of a futures contract?&#8221; tab_id=&#8221;1743197478498-a9d956aa-1181&#8243;][vc_column_text css=&#8221;&#8221;]An example would be a crude oil futures contract where a buyer agrees to purchase 1,000 barrels of oil at \u20b96,000 per barrel on a date three months in the future. If prices rise to \u20b96,500, the buyer can profit from the difference without actually taking delivery of the oil.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=&#8221;How does futures trading work?&#8221; tab_id=&#8221;1743198000000-aaaa1111-bbbb&#8221;][vc_column_text css=&#8221;&#8221;]Futures are traded on formal exchanges using margin-based trading. Traders deposit an initial margin to open positions and must maintain a minimum balance to keep them active. Prices are settled daily, and contracts can be closed or rolled over before expiry.[\/vc_column_text][\/vc_tta_section][vc_tta_section title=&#8221;Are futures contracts settled on a daily basis?&#8221; tab_id=&#8221;1743198500000-cccc2222-dddd&#8221;][vc_column_text css=&#8221;&#8221;]Yes, futures are settled daily using the mark-to-market method. This ensures that gains and losses are realised each day, adding transparency and managing credit risk in the system.[\/vc_column_text][\/vc_tta_section][\/vc_tta_accordion]<\/p>\n<\/div>","protected":false},"excerpt":{"rendered":"Futures contracts have become an integral part of global financial markets. Whether you&#8217;re a trader, investor, or someone curious about how the stock market operates, understanding the types of futures is essential. These contracts allow individuals and institutions to buy or sell an asset at a fixed price on a specific future date. They are","protected":false},"author":1,"featured_media":10616,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sitemap_exclude":false,"_sitemap_priority":"","_sitemap_frequency":"","footnotes":""},"categories":[289],"tags":[],"class_list":["post-8685","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-futures-and-options-trading"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Different Types of Futures Contracts: Explained with Key Examples<\/title>\n<meta name=\"description\" content=\"Explore different types of futures contracts like stock, index, commodity and currency futures. 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