Futures

Futures represent an agreement to buy or sell a specific quantity of a stock, security, or commodity at a set price on a certain date in the future. Short for "futures contracts," these agreements are legally binding. They must be fulfilled by either physical delivery or cash settlement.Many different commodities, currencies, and indexes are traded in futures. This offers traders a wide array of products. Since futures contracts can be bought and re-sold any time the market is open up until the fulfillment date, they are a popular product among day traders. Here's what futures contracts are, how they work, and what you need to start trading them.