The delivery date is the date on which the underlying commodity is delivered. This is the date that the contract expires and is settled.
Why would you buy a futures contract?
A futures contract is an agreement to buy or sell an asset at a future date at a price that is agreed upon today. Futures contracts are used by investors to hedge against price changes in the underlying asset, or to speculate on the direction of the price.
Futures contracts are traded on exchanges, and the price is determined by the interaction of supply and demand. The most common types of futures contracts are for commodities, such as oil, corn, or gold. However, futures contracts can also be used for financial assets such as currencies or stock indexes.
The key benefit of futures contracts is that they provide investors with a way to manage risk. By hedging against price changes, investors can protect themselves from losses if the price of the underlying asset moves in an unfavorable direction. Futures contracts also provide a way to speculate on the direction of prices, which can lead to profits if the price moves in the desired direction.
What is physical delivery in future? In futures trading, physical delivery is the transfer of the underlying asset from the seller to the buyer. This typically occurs at the expiration of the contract, at which point the contract is settled. Physical delivery is the most common type of settlement in futures trading.
Do futures contracts have a range of delivery dates? Futures contracts do have a range of delivery dates, but the specific delivery date is not set until the contract is negotiated between the buyer and seller. The delivery date is typically set for some time in the future, but it can be set for any date that is mutually agreed upon by the parties.
What happens if you don't sell a futures contract?
If you don't sell a futures contract, then you will be "long" the contract, meaning that you will have to buy the underlying asset at the expiration date of the contract at the specified price. If the price of the underlying asset goes up, then you will make a profit on the contract. If the price of the underlying asset goes down, then you will lose money on the contract.
What is the importance of delivery date? The delivery date is the day on which a commodities contract expires and delivery of the underlying asset must take place. The delivery date is also the final day on which trading can take place in a futures contract. After the delivery date, the contract is said to "expire."