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Spot contract. In finance, a spot contract, spot transaction, or simply spot, is a contract of buying or selling a commodity, security or currency for immediate settlement (payment and delivery) on the spot date, which is normally two business days after the trade date. The settlement price (or rate) is called spot price (or spot rate ).
t. e. In finance, a forward contract, or simply a forward, is a non-standardized contract between two parties to buy or sell an asset at a specified future time at a price agreed on in the contract, making it a type of derivative instrument. [1] [2] The party agreeing to buy the underlying asset in the future assumes a long position, and the ...
Money portal. v. t. e. In finance, a futures contract (sometimes called futures) is a standardized legal contract to buy or sell something at a predetermined price for delivery at a specified time in the future, between parties not yet known to each other. The asset transacted is usually a commodity or financial instrument.
e. The spot market or cash market is a public financial market in which financial instruments or commodities are traded for immediate delivery. [1] It contrasts with a futures market, in which delivery is due at a later date. [2] In a spot market, settlement normally happens in T+2 working days, i.e., delivery of cash and commodity must be done ...
The forward price of such a contract is commonly contrasted with the spot price, which is the price at which the asset changes hands on the spot date. The difference between the spot and the forward price is the forward premium or forward discount, generally considered in the form of a profit , or loss, by the purchasing party.
Electricity market is characterized by unique features that are atypical in the markets for commodities or consumption goods. Although few somewhat similar markets exist (for example, airplane tickets and hotel rooms, like electricity, cannot be stored and the demand for them varies by season), the magnitude of peak pricing (peak price can be 100 times higher than an off-peak one) sets the ...
The foreign exchange market ( forex, FX (pronounced "fix"), or currency market) is a global decentralized or over-the-counter (OTC) market for the trading of currencies. This market determines foreign exchange rates for every currency. It includes all aspects of buying, selling and exchanging currencies at current or determined prices.
Contango is a situation in which the futures price (or forward price) of a commodity is higher than the expected spot price of the contract at maturity. [1] In a contango situation, arbitrageurs or speculators are "willing to pay more [now] for a commodity [to be received] at some point in the future than the actual expected price of the ...