Futures Fundamentals: Commodity, Equity, and Currency Futures

Overview/Description
Futures contracts have long been used by the agriculture industry to eliminate the price risks associated with farming produce. This elimination of price risks, known as hedging, has become a common practice in today's markets. Trading in futures has moved beyond its agricultural origins and is now a modus operandi for numerous trading parties whose incentives are to either decrease the risk factor by hedging, or to make a profit through speculation. Futures contracts form a significant trading sector in the global financial system. They now trade on various commodities, including energy, single stocks and stock indices, interest rates and currencies, and some more exotic benchmarks such as the climate. This course examines the fundamentals of futures contracts, including their pricing and quotation, and how they are used by hedgers as a protection against adverse price risks and by speculators as a means to increase profit through calculated risk. The course looks at commodity, equity, and currency futures.

Target Audience
Financial services professionals, consultants, sales professionals interested in providing or selling products and services to banks, investment companies, other financial corporations, and everyone interested in understanding commodity and financial futures and forwards

Expected Duration (hours)
1.0

Lesson Objectives

Futures Fundamentals: Commodity, Equity, and Currency Futures

• identify how futures are traded
• differentiate between components of futures contracts
• recognize characteristics of futures contracts
• recognize characteristics of commodity and equity futures
• identify characteristics of currency futures
• recognize types of futures