Commodity trading contracts types: spot commodity contract, forward commodity contract, and futures commodity contract.
1. Spot contract
Spot commodity contract is an agreement in commodity trading that the delivery either takes place immediately or if there is a minimum lag , due to technical constraints, between the trade and delivery.
2. Forward contract
Forward commodity contract is an agreement in commodity trading between two parties to exchange at fixed future date a given quantity of a commodity for a price defined today
3. Futures contract
Futures commodity contract is similar to forward contract but is transacted through a futures exchange.
In my view, for individual investors, the futures contract is more suitable than others. What do you think about the best contracts trading commodity?
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