Futures exchange

Futures exchange,

Definition of Futures exchange:

  1. The function of a futures exchange is to standardize and promote futures trading for as many participants as possible. The incentive mechanisms for those who run the exchange are roughly based on the volume and dollar value of what is traded—the more the better. That means they work to bring in as many participants making as many trades as is possible. This has led to many innovations in recent years, driving increased participation through electronic networks.

  2. A market in which futures contracts are bought and sold.

  3. A futures exchange is a marketplace where a diverse range of commodities futures, index futures, and options on futures contracts are bought and sold. Those who are allowed access to the exchange are brokers and commercial traders who are members of the exchange. Members need to be registered with the National Futures Association (NFA) and the Commodity Futures Trading Commission (CFTC). Individuals who want to trade futures contracts must do so by establishing an account with a registered broker. Futures exchanges also provide clearing and settlement functions.

  4. Trading center with established rules and regulations, and where buyers and sellers meet to trade futures contracts and options in commodities and financial instruments. Worlds major futures exchanges are Chicago Board Of Trade, Chicago Mercantile Exchange, Commodity Exchange (New York), Financial Futures Market (Montreal, Canada), Gold Exchange of Singapore, Hong Kong Commodities Exchange, International Futures Exchange (Bermuda), London International Futures Exchange, Mid America Commodity Exchange (Chicago), New York Futures Exchange, Sydney Futures Exchange, Tokyo International Financial Futures Exchange, and Toronto Stock Exchange Futures Market.

How to use Futures exchange in a sentence?

  1. The price of oil on the futures exchange has crept up.
  2. Access to the exchange is available only to member firms and individuals.
  3. Futures exchanges allow people who want to trade commodities the ability to quickly find each other and safely trade.
  4. Exchanges also provide clearing services.
  5. Individuals who want to trade must do so through a broker firm who is a member of the exchange.

Meaning of Futures exchange & Futures exchange Definition