Seminar paper from the year 2012 in the subject Economics - Finance, grade: 1,0, University of Westminster (Westminster Business School), course: International Risk Management , language: English, abstract: Since the 1970s futures contracts have proven a real success story, but in the course of the crisis, several futures-trading businesses went bankrupt. Because of a lack of trust, futures trading volumes started decreasing. But, even though the futures market has been adversely affected, futures contracts still serve as a fundamental risk management tool. This paper provides an insight into the use of futures contracts in risk management, trading on US exchanges. After a brief introduction to the topic of futures contracts, current literature will be reviewed. The literature review focuses primarily on current issues and developments on the futures market, while the third chapter explains step by step - based on an example of foreign exchange hedging - the use of futures contracts as well as how futures transactions are processes. Finally, the third chapter summarises relevant criteria a company has to reflect when considering to invest in futures contracts.

March 1995 Financial futures have become the cornerstone of financial management. The paper explains the contractual features of an array of financial futures, basic pricing relationships, and how futures can be used by investors and risk managers. Mas and Saá-Requejo explain the features of an array of futures contracts and their basic pricing relationships and describe a few applications to show how investors and risk managers can use these contracts. Futures -- and derivatives generally -- allow economic agents to fine-tune the structure of their assets and liabilities to suit their risk preferences and market expectations. Futures are not a financing or investment vehicle per se, but a tool for transferring price risks associated with fluctuations in asset values. Some may use them to spread risk, others to take on risk. Financial futures (along with options) are best viewed as building blocks. Futures have facilitated the modern trend of separating conventional financial products into their basic components. They allow not only the reduction or transformation of investment risk but also the understanding and measurement of risk. The market for derivatives has grown enormously over the past decade. The value of exchange-traded eurodollar derivatives (futures and options) is equal to roughly 13 times the value of the underlying market. The volume of trading in financial futures now dwarfs the volume in traditional agricultural contracts. As emerging markets develop, given their inherently risky nature, expect financial futures to play a prominent role in risk management. This paper -- a product of the Private Provision of Public Services Unit, Private Sector Development Department -- is part of a larger effort in the department to promote risk management techniques in emerging markets.

Unlock the Secrets to Profitable Trading with Futures Contracts! Are you ready to elevate your trading game and tap into the world of futures? "Profitable Trading with Futures Contracts" is your essential guide to mastering one of the financial market's most dynamic and potentially rewarding arenas. This comprehensive eBook is meticulously structured, covering every facet of futures trading from the ground up. **Chapter 1 Introduction to Futures Trading** sets the scene, presenting a clear explanation of what futures contracts are, their historical development, and the benefits and risks associated with them. Whether you're a novice or an experienced trader, this introduction provides a solid foundation. **Chapter 2 to Chapter 4** delve into the intricacies of the futures market, the types of contracts available, and key players involved. You'll gain insights into financial futures, commodity futures, and how these different categories can diversify and augment your trading portfolio. Understanding the **mechanics of a futures contract** is crucial, and **Chapter 5** ensures you're well-versed in contract specifications, margin requirements, and the subtleties of settlement and delivery. Ready to kick off your trading journey? **Chapter 6** walks you through opening a futures trading account, choosing the right brokerage, and setting up your financial base. Developing a robust **trading strategy** is pivotal. In **Chapter 7**, explore fundamental and technical analysis, and discover how to seamlessly combine both for optimal decision-making. Navigating the risks involved in futures trading is made easier with **Chapter 8**, which covers risk management techniques, including setting stop-loss orders and deploying hedging strategies. From placing and managing trades to leveraging cutting-edge technology, **Chapter 9 and Chapter 10** will empower you with practical skills and modern tools to stay ahead in the market. Stay compliant and knowledgeable about the legal landscape with **Chapter 11**, and build the psychological resilience needed for trading success in **Chapter 12**. Learn from the best with **Chapter 13's case studies**, and keep honing your skills with continuous practice, as highlighted in **Chapter 14**. Future-proof your trading career by troubleshooting common issues in **Chapter 15**, planning for long-term success in **Chapter 16**, and integrating futures trading into your broader financial plan in **Chapter 17**. Dive into "Profitable Trading with Futures Contracts" and transform your trading approach. This eBook is your step-by-step guide to navigating and mastering futures trading, offering strategies and insights to help you trade confidently and profitably. Secure your copy today and start your journey to becoming a successful futures trader!

Seminar paper from the year 2017 in the subject Economics - Finance, grade: 75%, University of Westminster, language: English, abstract: Futures contracts are simple derivative instruments used for hedging purposes that is to counter financial risk. This study examines the role played by these instruments for managing risks in the global business world whilst highlighting the merits and demerits of their applications relative to other plain vanilla products (i.e. forwards, swaps and options). Further, this report presents the details on the structure/typical specifications and pricing of currency futures (CFs) contracts as well as the key differences inherent between the futures and other derivative products. In the literature review, the study seeks to answer the question on why firms need to use currency futures to hedge against FX risk, and provide a justification on the usefulness of currency futures in predicting the spot rate changes and currency futures returns. Finally, the study uses two hypothetical cases to demonstrate how CFs can effectively be used to hedge against FX risk.