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The Basics On Futures & Options: Kansas City Board of Trade
The Basics On Futures & Options: Kansas City Board of Trade
contract to make or take delivery of a product in the future, at a price set in the present In formalized futures and options trading on exchanges, standardized agreements specify price, quantity, and month of delivery Started in agriculture, but have expanded to a wide range of products
Example
If
you agree in April with your Aunt Sue that you will buy two pounds of tomatoes from her garden for $5, to be delivered to you in July, you just entered into a futures contract!
Risk
number of factors to consider including account type, trading style Traded through a registered broker
your homework Choose a broker Enter into an agreement Make your first trade
first trade.