Futures Contract Concepts
Not an actual sale
Always a winner & a loser (unlike stocks)
K are “settled” every day. (Marked to Market)
Hedge - K used to eliminate risk by locking in prices
Speculation - K used to gamble
Margin - not a sale - post partial amount
Hog K = 30,000 lbs
Tbill K = $1.0 mil
Value line Index K = $index x 500