Daughter #4 is in her final year of college. She is taking up a double degree course in BS Economics and BS Management of Financial Institutions. She is the only one in the family whose degree gears towards business and finance. I asked her what futures trading is as I came across that term in one of my readings. Here's her explanation for a dummy like me.
The farmer is the seller while the dealer is the buyer. The farmer agrees to deliver 50 bushels of grain to the dealer at a certain date at a certain price. The two parties agreed on the terms and signed a contract. The dealer might have made a deposit to the farmer for "guarantee" sealing contract. That is futures trading in a nutshell.
The farmer is the seller while the dealer is the buyer. The farmer agrees to deliver 50 bushels of grain to the dealer at a certain date at a certain price. The two parties agreed on the terms and signed a contract. The dealer might have made a deposit to the farmer for "guarantee" sealing contract. That is futures trading in a nutshell.
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