Sample futures contract for the sale of goods. Examples of settlements for futures contracts

Example 2.

Let an investor buy 1 share of company X at a spot price of $200. For the same money, that is, for a premium of $2 per share, you can purchase a call contract on the options market with a duration of 1 month to purchase 100 shares of company X at a strike price of $210.

Let's assume that the stock price increased by $20 within ten days. If the option holder exercises his right at this time, he can resell those 100 shares for a profit of $220 - $210 = $10 per share, for a total gain of $10 x 100 = $1,000, or less the $200 premium paid. will have a profit of $800.

Note: In reality, in practice, this amount will be slightly lower due to the payment of commissions to brokers, interest on the capital provided for the purchase of shares under the option, and other overhead costs.

Compared to buying an option, buying one share would bring the investor an income of only $220 - $200 = $20. That is, in the described case, a successful option turns out to be approximately 40 times more profitable, and the financial leverage ratio is 40 to 1. On the other hand, if the stock price did not increase (or the growth did not exceed $210), the money spent on purchasing the option would be lost , while the share would have remained with their owner.

Thus, an option is a high-risk investment and the risk-to-reward ratio of options is extremely high.

Futures is a standard exchange contract, according to which one party entering into it undertakes to sell to the other party (or buy from it) a certain exchange asset at a certain point in time in the future at a predetermined price established by the parties to the transaction at the time of its conclusion.

As can be seen from the definition, technical futures can only be traded on exchanges. Equivalent over-the-counter instruments are called forwards , which, unlike futures, do not have a guarantee in the form of the exchange's clearing house, therefore they are not liquid securities and do not have a standard form. Moreover, if a contract purchased on an exchange is physically impossible to close by selling on an exchange or by actual delivery of an exchange asset from a site specified by the exchange, then, strictly speaking, it will be an exchange forward contract, and not a futures contract.

Futures contracts, like options contracts, are dealt with by two types of individuals - speculators and hedgers.

Speculators buy and sell futures in order to make a profit, closing their positions at a better price than the original one. Under position in this case, any transaction started and not completed is understood. Another distinctive characteristic of speculators is that they do not produce or use the underlying assets in the normal course of business.

Hedgers , unlike speculators, on the contrary, they buy and sell futures in order to eliminate a risky position on spot market (real goods market) because they are either producers or consumers of the underlying asset.

Both speculators and hedgers, when buying a futures contract, occupy the so-called long position and vice versa, when selling a futures contract, they borrow short position . They are respectively called long speculators and hedgers, and short speculators and hedgers.

In accordance with the positions taken and trading strategies in the futures market, regardless of the type of underlying asset, there are two main ways to use this derivative instrument, called: “producer hedge” or " long hedge " And " consumer hedge " or " short hedge ”.

Since futures were originally intended to provide a hedging mechanism for commodity producers and their customers, it is useful to consider a specific digital example to explain the above terms by commodity futures , which are based on a product of a seasonal (for example, grain) or opportunistic (natural) nature (for example, copper).

Example 2.

Consider, for example, futures for the delivery of wheat. Let's assume that the current market price of this asset is $1,000 per ton. This price really reflects the costs of the producer-farmer, taking into account his expected average profitability and level of profitability. The farmer seeks to insure the future harvest based on today's conditions, so the futures price of the underlying asset in three months should be a price that reflects the value of the underlying asset, financing costs, as well as storage, insurance and transportation of wheat.

Financing costs are associated with the factor of temporary inequality of money, since $1000 today is worth slightly more than some time later (in our example, after 3 months), so it is necessary to take into account alternative investment option these funds. As a rule, a bank deposit is considered as a risk-free alternative.

In other words, $1000 placed in a bank for 3 months at, say, 10% per annum will give its owner an income by the end of the term in the amount of:

This amount must be taken into account when calculating the futures price. In addition, it is necessary to take into account the costs associated with storing this asset for 3 months (payment for storage space, insurance, security, transportation, etc.). By setting this amount to, say, 4% of the price ($10), we get the total fair futures price for the underlying asset:

1000$ + 25$ + 10$ = 1035$ .

This price fully suits the farmer and, wanting to insure against a possible fall in prices below this level, he purchases a futures contract under these price conditions from his counterparty - the consumer of these products - a flour mill. The latter is interested in concluding this futures based on the considerations that at the moment he does not need the underlying asset at a price of $1000, so he is ready to pay $35 for the manufacturer’s estimated operating expenses and, in addition, wanting to insure against what is quite possible from his point of view appreciation of the asset.

When concluding a futures contract, each participant in the transaction deposits the so-called initial margin guaranteeing the fulfillment of the obligations undertaken by the parties. The margin amount is set by the management of the exchange. Regardless of fluctuations in prices for futures contracts, participants in the transaction are required to maintain the contribution at the established level. Cash, short-term securities, irrevocable deposits and other highly liquid funds can be used as initial margin. The initial margin is returned if the open position is liquidated after the contract is executed or if the opposite position is compensated.

In addition to the initial margin, the exchange management has the right to require payment additional margin in the event of a sharp fluctuation in prices for a futures contract or in the event of a deterioration in the financial situation of one of the parties to the transaction.

As a rule, additional margin is paid while maintaining an open position and in the month (last days, hours) of delivery of goods under the futures contract. Additional margin is also returned either if the position is closed or if the market situation normalizes. The size of the additional margin is usually equal to the size of the initial margin.

Futures contracts are “marked to market” daily (in other words, each contract is treated as if it were closed each trading session and opened at the beginning of the next) using variation margin , which is contributed (or can be received) by one of the parties in favor of the other party as a result of a change in the price of the futures. Thus, variation margin is the gain or loss of participants in a futures transaction.

Various types of variation margin based on the results of a trading session can be calculated using the following formulas:

Vo = St - Co, where [2.1]

In - variation margin for positions opened during the trading session;

St - contract value at the quotation price of a given trading session;

Co - the value of the contract at the time of opening the position.

Suppose that in our example, St will be $1000, that is, the futures price will fall, then

In = 1000$ - 1035$ = -35$,

that is, the variation margin will be paid by the buyer of the futures to the seller.

In other words, as a result of the revaluation of a futures contract in a given trading session, the seller of the futures can “purchase” it for $1000 and sell it at the contract price of $1035, thus he will receive a gain of +$35, and his counterparty - the buyer of the futures - will lose - $35.

W = St - Sn, where [2.2]

W - variation margin for positions remaining open during the trading session;

Сн - contract value at the quotation price of the previous trading session.

Suppose that in our example, St will be $1020, that is, the futures price will increase compared to the previous trading session, then:

W = 1020$ - 1000$ = 20$,

that is, the variation margin will be paid by the seller of the futures to the buyer. Since the contract value at the beginning of the trading session was $1000, and at the quotation price $1020, in this case the seller “loses” -$20, since he is forced to “execute” the contract at a price lower than the quotation price.

Thus, based on the results of two trading sessions, we have a common position of buyer and seller, presented in Table 2.1.

Table 2.1

____________________ "__"________ ___ city _______________________________________________, hereinafter referred to as (name) "Party 1", represented by ________________________________________, acting___ (position, full name) on the basis of _________________________, on the one hand, and ________________ (Charter , regulations) _____________________________, represented by _____________________________________, (name) (position, full name) acting___ on the basis of _____________________________________, referred to as__ in the (Charter, regulations, power of attorney) hereinafter "Party 2", on the other hand, concluded at exchange trading _______________________ exchange this agreement as follows.

1. THE SUBJECT OF THE AGREEMENT

Options:

a) Party 2 also undertakes, in the event of a demand from Party 1, to transfer the underlying asset to it, including by concluding a futures agreement (contract) by the party (parties) and (or) the person (persons) in whose interests the futures contract was concluded agreement (contract), agreement for the purchase and sale (supply) of goods;

b) the parties are also required to enter into an agreement that is a derivative financial instrument and constitutes the underlying (underlying) asset.

1.2. Underlying asset: securities (currency, commodity): ____________________.

1.3. Range of price changes of the underlying (underlying) asset for premium payment:

1.3.1. If the price increases by at least _____ points (percent, etc.), a premium in the amount of _____ rubles is paid by Party 2 (or: Party 1).

1.3.2. If the price increases over _____ points (percent, etc.), a premium in the amount of _____ rubles is paid by Party 2 (or: Party 1).

1.3.3. If the price decreases by ____ points (percent, etc.), a premium in the amount of _______ rubles is paid by Party 2 (or: Party 1).

1.3.4. If the price decreases by at least _____ points (percent, etc.), a premium in the amount of _____ rubles is paid by Party 2 (or: Party 1).

1.4. Range of price changes of the underlying (underlying) asset for repurchase (or: sale):

1.4.1. Increase in price by at least ______ points (percent, etc.).

1.4.2. Price increase over ________ points (percentage, etc.).

1.4.3. Reducing the price by __________ points (percent, etc.).

1.4.4. Reducing the price by at least ______ points (percent, etc.).

Type of agreement:

1.5. A reliable source of information about price changes under this agreement is: ____________________. The data is presented in the form _________________________.

1.6. If the reported information is not properly confirmed to be true, it is considered unreliable and is not a basis for payments (redemption, sale).

1.7. The right to payment (redemption, sale) is valid for ___ hours from the occurrence of a certain event, regardless of its subsequent change.

1.8. A change in circumstances during the period agreed upon in clause 1.7 of this agreement to the opposite is the basis for withdrawing your demand for payment (redemption, sale).

1.9. If prices remain unchanged or prices change without exceeding established limits during the term of this agreement, Party 1 has the right to: ________________________________.

1.10. Derivative documents are issued within ____ hours from the moment the corresponding request is submitted.

2. PAYMENT PROCEDURE

2.1. The premiums provided for in this agreement are paid within ___ hours from the moment the moment agreed upon by the parties is confirmed by the document, based on the invoice issued by the other party.

3. RIGHTS AND OBLIGATIONS OF THE PARTIES

3.1. When the specified event occurs, the party interested in payment (purchase, sale) is obliged to provide the other party with properly executed documents.

3.2. Each party has the right to receive from the other party information relating to its financial stability that is not a trade secret.

3.3. Each party has the right to verify any information communicated to it related to this agreement.

4. RESPONSIBILITY OF THE PARTIES

4.1. The party that fails to fulfill or improperly fulfills its obligations under this agreement is obliged to compensate the other party for losses caused by such failure, including lost profits.

4.2. For late payment (redemption, sale), the violating party shall pay the injured party a penalty in the amount of ___% of the unpaid amount for each day of delay.

4.3. Collection of penalties and interest does not relieve the party that violated the contract from fulfilling obligations in kind.

4.4. In cases not provided for by this agreement, property liability is determined in accordance with the current legislation of the Russian Federation.

4.5. The party that provided false information at the request of the other party shall pay it a fine in the amount of ______ rubles.

5. CHANGES TO THE AGREEMENT

5.1. Party 1 can be replaced by another person only with the consent of Party 2.

5.2. Party 1 has the right to replace the third party with another person with subsequent notification to Party 2.

5.3. In the event of the commencement of the liquidation procedure by either party, it is obliged to fulfill all its obligations under this agreement ahead of schedule.

6. TERM OF THE AGREEMENT

6.1. This agreement is concluded for a period of ________ and comes into force from the moment of signing.

6.2. The term of the agreement may be extended by agreement of the parties.

6.3. In the event of demands for payment (redemption, sale), the contract is automatically extended until their completion.

7. END, TERMINATION OF THE AGREEMENT

7.1. The Agreement is valid until the expiration of the period specified in clause 6.1. Obligations arising during the validity period of the contract are subject to fulfillment regardless of its expiration.

7.2. The contract may be terminated early by agreement of the parties.

7.3. Termination of the contract does not relieve the parties from liability for its violation.

8. PRIVACY

8.1. The terms of this agreement, additional agreements to it and other information received in accordance with the agreement are confidential and are not subject to disclosure.

9. DISPUTE RESOLUTION

9.1. All disputes and disagreements that may arise between the parties on issues that are not resolved in the text of this agreement will be resolved through negotiations on the basis of the current legislation of the Russian Federation.

9.2. If controversial issues are not resolved during negotiations, disputes are resolved in court in the manner established by the current legislation of the Russian Federation.

10. ADDITIONAL TERMS AND CONDITIONS

10.1. Additional terms of this agreement: ____________________.

10.2. Any changes and additions to this agreement are valid provided that they are made in writing and signed by the parties or duly authorized representatives of the parties.

10.3. All notices and communications must be given in writing.

10.4. In all other respects that are not provided for in this agreement, the parties are guided by current legislation.

10.5. The agreement is drawn up in two copies - one for each of the parties.

10.6. Addresses and payment details of the parties:

Side 1: ________________________________________________

___________________________________________________________

Side 2: ________________________________________________

___________________________________________________________

SIGNATURES OF THE PARTIES:

Side 1: ________________________

Side 2: _________________________________

Options and futures belong to the so-called derivatives. A financial instrument is called a derivative if its value depends on the price of some underlying asset (commodity, currency, shares, bonds), interest rate, stock index, temperature or other quantitative indicator.
A futures transaction is carried out on the basis of futures contracts. A futures contract is a standard exchange agreement for the purchase and sale of a financial asset at a certain point in time in the future at a price set by the parties to the transaction at the time of its conclusion.
The purpose of futures trading is not to buy and sell the underlying asset, but to obtain a positive price difference from the purchase and sale of futures contracts. Futures trading is primarily speculative in nature.
Understanding a futures contract is best achieved by comparing it with a forward contract. Futures contracts are the same forward contracts with a number of additional properties or distinctive features. The main differences between futures contracts and forwards and other non-exchange types of contracts are shown in Table 6.

So, the distinctive features of a futures contract are:
1. Exchange character. A futures contract is an exchange contract that is developed on a given exchange and can only be traded on that exchange. An over-the-counter futures contract with features of a futures contract is called a forward contract.
2. Standardization of the contract according to all parameters (name of the stock asset, volume, execution date, etc.), except price. The contract price is set by the parties to the transaction at the time of its conclusion.
3. The exchange is a guarantor of fulfillment of obligations under the contract for the parties to the transaction, i.e. in the event of failure to fulfill obligations under the transaction by one of its participants, the exchange will fulfill its obligations.
4. A special mechanism for concluding, handling and executing transactions. The consequence of this was the specialization of some stock exchanges exclusively in working with futures contracts, so such exchanges were called futures exchanges.
Futures contracts can be divided into two main groups: commodity and non-commodity futures. The group of commodity futures includes: agricultural products, industrial raw materials, oil and petroleum products, precious and non-ferrous metals, etc. The underlying assets of non-commodity futures are securities, currencies, stock market indices, interest rates, etc.
Today in Russia there are futures only for securities, currencies and indices.
The main trading in futures contracts is carried out on the largest trading platforms in Russia:
- MICEX derivatives market section;
- futures and options market on the RTS (FORTS).
The MICEX Derivatives Market Section organizes trading in futures for the US dollar and euro, and for shares (OJSC Lukoil, OJSC Surgutneftegaz, RAO UES of Russia).
The FORTS market in the RTS system offers trading participants the widest range of futures contracts, the underlying assets of which are shares of Russian issuers (RAO UES of Russia, OJSC Gazprom, OJSC Lukoil, OJSC Rostelecom, OJSC Surgutneftegaz, OJSC MMC Norilsk Nickel, OJSC Sberbank of Russia), RTS index, bonds and foreign currency.
Standardizing the volume of the underlying asset for which the futures contract is concluded allows each party to the transaction to know in advance how much of the asset is subject to purchase and sale (for example, a futures contract for the US dollar exchange rate in the RTS is $1,000). As a result, futures trading is trading of a whole number of contracts, and the purchase and sale of assets whose volume is not a multiple of the established standard lot is impossible.
Any futures contract has a limited life (most futures are quarterly contracts that expire in the months of March, June, September, December).
During this period, futures can be purchased and sold. On the date specified in the contract, delivery of the underlying asset and final cash settlement must occur. Exchange trading stops several days before the delivery date. Since the exchange trades futures with different expiration dates every day, a special exchange calendar is created, which reflects the execution dates of all traded futures contracts.
There is a generally accepted style of naming futures contracts. On the RTS derivatives market, 4-symbol tickers are used, consisting of the code of the underlying asset (2 characters), month of execution (1 character), year of execution (1 character). For example, the ticker ESU5 means “contract for shares of RAO UES of Russia with quotes in rubles and execution on September 16, 2005.”
The initial purchase or sale of a futures contract is called opening a position. In this case, buying a contract is called opening a long position (long futures), and selling a contract is called opening a short position (short futures).
To buy a futures contract means to undertake an obligation to accept the primary asset from the exchange within a predetermined period, paying for it the price set at the time the contract was concluded.
To sell a futures contract means to undertake the obligation to deliver the primary asset to the exchange when the contract expires and receive funds for it corresponding to the sale price of this contract.
The seller or buyer has the right at any time before the expiration of the futures contract to liquidate their obligations under it by concluding a transaction opposite to the previously made one, or an offset transaction. When conducting an offset transaction, the need for delivery of the underlying asset disappears, since the position under the contract is buried. Therefore, at the expiration of the contract, only the difference in prices (between the futures price at which the contract was concluded and the current price at the time of delivery) is paid. As a result, futures contracts are rarely executed - less than 2 percent of all completed transactions end in actual delivery of the asset.
Futures typically trade at a premium to the stock price.
The price of a futures contract will generally be calculated using the following formula:

where Tsf is the cost of a futures contract for an exchange asset;
Tsa is the market price of the underlying asset in the physical market;
P - bank interest on deposits;
D - the number of days until the expiration of the futures contract or its closure.
The situation when prices for futures transactions exceed the prices for a real asset, and the quotes of distant positions are higher than the quotes of nearby positions is called “contango” (from the English contango or normal market), the inverse ratio of prices in the market is called “backwardation” (from the English backwardation or inverted market).
Since futures holders do not have the right to collect dividends, the futures price must be adjusted to the existing value of dividend payments expected before expiration. That is, if an exchange asset generates a certain income, for example a dividend on a stock, then this income is subtracted from the bank interest rate and the formula takes the following form:

where Pa is the average dividend on a stock or interest on a bond.
When a large dividend payment is approaching or if the underlying asset is difficult to borrow, the futures price may be less than the actual cash price.
Each futures contract between a seller and a buyer is converted into two new contracts: between the exchange (clearing house) and the seller and between the exchange and the buyer. The clearing house acts as a third party in all futures transactions, is the basis for all settlements under contracts, and is designed to ensure the financial stability of the futures market, protect the interests of clients, and control over exchange operations.
To ensure all settlements under contracts, the clearing house collects a guaranteed deposit (margin) from the parties to the transaction, the amount of which is determined based on the market characteristics of the asset for which the contract is concluded. There are three types of margins in the futures market.
Initial margin is the deposit made by the buyer and seller of a contract for each open position. It ranges from several to tens of percent of the value of the underlying asset. The initial margin is calculated using the formula:

M = Tsk x Pm / 100, (9)

where M is the amount of the initial margin;
Tsk is the price of a futures contract on the exchange market;
PM - the percentage rate of the initial margin.
Variation margin is the amount calculated daily based on the results of trading for each open position, which is deposited by the buyer or seller into the clearing house. The margin is debited from the account or credited to the trading participant's account.
Calculation of variation margin on the day of opening a position is carried out using the formula:

Mn = a x (Tsk - Tso), (10)

where Mn is the amount of variation margin; a = - 1 if the contract was sold, +1 if the contract was bought;
CC - the quoted price of the contract for this trading session;
Tso is the contract value at the opening price.
If Mn > 0, then the owner of the open position has potential profit, if Mn< 0 - убыток.
Calculation of variation margin for previously opened positions that were not closed on a given day:

Mn = a x (Tsk1 - Tsk0), (11)

Tsk1 - quoted price of the contract for this trading session;
Tsk0 - the quoted price of the contract on the previous trading day.
Calculation of profit (loss) for a position closed after a certain period or upon execution of a contract:

D = a x (Tsk - Tso) + Mn, (12)

where a = - 1 if the contract was sold, +1 if the contract was bought;
TsK - the quoted price of the exchange on the day of closing the contract or its execution;
Tso - the closing price of a position under a contract or the quotation price of the exchange of the previous day in the event of the contract being due;
Mn is the accumulated variable margin for a given open position until the day of its closure or execution.
Maintenance margin is the minimum deposit required to maintain a position. If, in the event of an unfavorable price change, the margin drops to this level, the position is automatically closed.
Apart from the peculiarities of working with margin, trading futures contracts is similar to trading stocks. For professional players, speculation with futures is much more attractive compared to trading with other instruments. This is explained by the fact that the use of futures contracts allows for transactions with high profitability, low costs and minimal investment of funds: a margin on futures of 15% essentially means 5-6 times the leverage, there are no depository costs, and low exchange fees.
However, futures trading is a risky business. Risks are associated with the need to maintain the required amount of funds to hold a futures position. The exchange may require the deposit of additional funds in a relatively short period of time in the following cases:
- if the futures market price moves in the opposite direction to the desired direction, the variation margin will be debited from the speculator’s account daily;
- if volatility in the market increases, the exchange may, in accordance with the established procedure, increase the requirements for contract guarantees.
You can speculate on the price dynamics of the same futures contract, as well as on the difference in prices of contracts that differ in standard parameters: execution dates, types of underlying assets. You can speculate on the difference in prices of identical contracts on different exchanges, on the difference in prices of the physical and futures markets.
The success of speculative operations depends on a properly developed speculation strategy, accuracy of price analysis and forecasting, and the ability to effectively manage capital. Before entering into an operation, an acceptable combination of profit and risk should be established.
The most typical strategies in the futures market are the following:
1. Opening a long or short position in anticipation of a subsequent change in the futures price is a common speculative strategy: buy lower, sell higher, or vice versa, first sell a futures contract and then buy it back at a lower price.
For example, a speculator believes that the shares of the ABC company are overvalued and decides to sell short 20 futures on the stock price of the ABC company at a price of 4,550 rubles. per contract (1 contract = 1000 shares).

Thus, to carry out the operation, funds in the amount of 9282 rubles were required.
Seven days later, shares of the ABC company were quoted at a price of 4,050 rubles. per share, and the speculator decided to close the position by buying futures contracts on the ABC company stock price with the same expiration date.

The return on the transaction is 105 percent of the initial investment.
2. Purchase (sale) of a futures contract with one delivery date and simultaneous sale (purchase) of the same contract with a different delivery date.
The basis of this strategy is that the prices of futures contracts with different expiration dates will not change at the same rate. For example, if the price of a contract with a near delivery month, for some reason, increases faster than the price of a contract with a distant delivery month, then the strategy is to buy a contract for a near term and sell it for a long term, and then, when the price for the near month will increase more than for the distant one, sell the contract for the near month and buy for the distant one. As a result, the increase in revenue under the contract with the near delivery month will cover the loss under the contract with the distant delivery month.

The opposite strategy occurs if the price of a futures contract with a distant delivery date increases faster than that of a future contract with a near-term delivery date. In this case, it is necessary to simultaneously: buy a contract with a long-term delivery date and sell the same contract with a short-term delivery date.
3. Purchase (sale) of a futures contract on one exchange and sale (purchase) of the same futures contract (that is, for the same asset with the same expiration date) on another exchange. This strategy is based on differences in price dynamics on different exchanges.

Looking at this example, one could say that there was no need to carry out such a strategy - it would be easier to buy a futures contract on exchange A and, after waiting a month, sell it on the same exchange, making a profit of 0.30 rubles per dollar. But in this case, it's all about risk. In fact, there are no guarantees that price dynamics will be exactly like this.
If the price of a futures contract were to decline on both Exchange A and Exchange B, then the investor would receive a loss on Exchange A. And since with such a strategy he plays on two exchanges at once, his loss on exchange A would be fully or partially compensated by the profit from the contract on exchange B.
4. Purchase (sale) of a futures contract for asset A and simultaneous sale (purchase) of a contract for asset B, while it is known that the price of asset A is quite closely related to the price of asset B. This usually applies to futures contracts for different types of bonds (state, municipal bonds, short-term and long-term bonds). The direction of changes in prices for interrelated assets is usually the same, but the degree of influence is different, and, consequently, changes in their prices will differ.

Thus, using various strategies, professional players are able to successfully speculate in futures contracts. However, in addition to speculation, futures are more often used for hedging transactions.
If speculation is aimed at making a profit from the difference in the prices of exchange assets in an amount directly proportional to the level of risk, hedging is aimed at reducing the market risk of an unfavorable change in the price of an asset.
Exchange trading participants who engage in hedging are called hedgers. In fact, in practice, every speculator, to one degree or another, insures himself by hedging, and the hedger, accordingly, never minds receiving additional profit if price dynamics are favorable to him.
The essence of hedging: a market participant takes directly opposite positions in the futures and physical markets at any given time. If a trader is a buyer in one market, he must take the position of a seller in another market, and vice versa.
There are short hedges (selling hedging) and long hedges (buy hedging).
Hedging with a purchase means entering into a futures contract to purchase it in order to minimize the risk of loss if prices rise in the future.
Sales hedging is carried out in order to minimize the risk of a price decrease when making deliveries in the future.
Situation 1 (hedging with a purchase).
An entrepreneur wants to buy dollars in a month, which today cost 31.50 rubles per dollar. He believes that in a month the dollar exchange rate will rise. To reduce his possible losses from such growth, he buys a futures contract with execution in three months at a price of 31.70 rubles per dollar. In a month, it’s time to buy dollars. Their rate actually increased on the physical market to 31.70 rubles per dollar, and on the futures market to 31.90 rubles per dollar (the market believes that the dollar exchange rate will further increase over the remaining 2 months).
In this case, the entrepreneur buys dollars on the physical market at a price of 31.70 rubles per dollar, and sells a futures contract at a price of 31.90 rubles per dollar. When buying dollars, he overpays 0.20 rubles per dollar compared to the situation a month ago. When selling a futures contract, he makes a profit of 0.20 rubles for every dollar (bought at 31.70, sold at 31.90), as a result, the entrepreneur compensated for the increase in price on the physical market with profit on the futures market, and his final purchase price was dollars remained at 31.50 rubles per dollar.
If the price on the physical market had risen by more than 0.20 rubles, then the hedger would have been able to compensate with the profit from the futures contract only part of the increase in the market price. But still, this is better than if his risk was equal to the entire value of the price increase on the physical market.
If the price on the physical market had fallen compared to the original date, the hedger would have bought dollars cheaper than expected and thereby saved some amount of his investment. However, most likely the price in the futures market would also change, and therefore the hedger would suffer a loss in an amount close to the amount of money saved in the physical market.
If there were multidirectional price movements in the physical and futures markets, then in one case the hedger could make big money, and in the other lose big. That is, if prices on the physical market fell for some reason (for example, by decision of the Central Bank), and continued to rise on the futures market, then the hedger would be able to buy dollars cheaper than a month ago, and by closing his contract, make a profit on the futures market.
But if prices on the physical market increased, and for some reason decreased on the futures market, then the hedger must buy the currency at a higher price on the physical market and close the futures contract at a loss.
Situation 2 (hedging by sale).
Suppose an investor has 250,000 shares of ABC Company in his portfolio, and conclude that their prices will fall. He cannot sell these papers, because... they act, for example, as collateral. In order to hedge against the possible depreciation of his shares, he can sell short 250 futures for ABC shares, whose execution occurs close to the moment the securities are “released” from collateral. The investor makes an initial margin of 500 rubles per contract (conditionally), namely 125,000 rubles. Let's say he sells futures at 4,550 rubles. Over time, the securities actually fell to 4,050 rubles. and at the moment of their “release” the investor sells them. Then, his losses on the stock market will be (4.550 - 4.050) x 250,000 = -125,000 rubles. While the profit from closing a position on futures is the same 125,000 rubles. True, they will have to be reduced by the amount of the exchange fee and broker commission. You can call it an insurance fee.
Uneven price declines in the physical and futures markets can result in losses for the hedger (if the price of a stock has fallen more than in the futures market), but in certain cases, hedging transactions in the futures market can completely exceed the losses and generate income. And a tool such as an option can help with this.
An option is a type of futures contract that gives the right to buy or sell an exchange asset at a fixed price on (or before) a specified date(s).
In exchange practice, two types of options are used: a buy option (call option), a sell option (put option). According to the first type of option, its buyer acquires the right, but not the obligation, to buy an exchange asset. Under the second type of option, the buyer has the right to sell this asset. The seller of the option is called the subscriber, and the buyer of the option is called the holder.
According to the expiration dates, the option can be of two types:
— American - the contract can be executed on any day before the expiration of the option;
— European - the contract can be executed only on the expiration date;
Option contracts, depending on the underlying asset, are divided into:
— commodity - the basis is any real product (precious or non-ferrous metals, oil, etc.);
- foreign exchange - based on changes in the exchange rates of freely convertible currencies in relation to the national currency;
- stock - the underlying asset is stocks, bonds, indices, interest rates;
— futures - are concluded on existing types of futures contracts. They give the right to buy or sell the corresponding futures contract at the option exercise price, that is, the option is exchanged for a futures.
The history of the development of the Russian derivatives market is mainly associated with futures contracts. Our options market is very poorly developed. Meanwhile, the volume of global options trading today is almost equal to the volume of futures trading, although the exchange options market is not yet 30 years old.
In Russia, options trading is possible only in the FORST RTS system. This:
— option on futures on shares of RAO "UES of Russia";
— option on futures on shares of OAO Gazprom;
— option on futures on shares of OAO LUKOIL;
— option on futures on shares of OJSC Rostelecom;
— option on RTS Index futures;
— options on futures on the US dollar exchange rate.
Option price (premium) is the payment for the right to buy or sell the underlying asset.
The risk of the option buyer is limited to the premium he pays. If the price change is unfavorable for the option holder, he may not exercise the option contract and thereby lose the premium. The seller's risk is unlimited and his return is based on a premium. In other words, the seller of the option takes on the risk of the buyer and receives a premium for doing so, which is the price of the option.
In addition to the premium, the option has its own exercise price. The exercise price (strike price) is the price at which an option contract gives the right to buy or sell the underlying asset.
For example, having paid a premium of 10 rubles per 1 share, the buyer of a call option has the right to buy 100 shares of this type within 3 months at a price of 100 rubles per 1 share (exercise price).
Option prices will depend on the price of the underlying asset in the physical market, the exercise price, the expiration date of the option, the volatility of the underlying asset and the risk-free investment rate.
The most general formula for calculating option prices is the Black-Scholes formula, which allows you to calculate the theoretical premium of a call option:

where C is the theoretical premium for the call option;
S - current price of the underlying asset;
t is the time remaining until the option is exercised, expressed as a fraction of a year (number of days until the exercise date/250 days);
K - option exercise price;
r - interest rate on risk-free assets;
N(x) - standard normal distribution with arguments.

where s is the annual standard deviation of the price of the underlying asset. Calculated by multiplying the standard deviation of the price over several days by the square root of 250.
Depending on the type of option, price, and expiration date, there are many option strategies. All option strategies can be divided into four main groups:
1. Simple strategies - opening one option position, i.e. buying or selling a call or put option;
2. Spread - simultaneous opening of two opposite positions for the same type of option with the same asset;
3. Combinatorial strategies - simultaneous opening of two identical positions for different types of options with the same asset (simultaneous purchase/sale of call and put options on the same asset);
4. Synthetic strategies:
— simultaneous opening of opposite positions for different types of options with the same asset;
— simultaneous opening of a position on the physical market of the asset itself and on the options market for this asset.
Each group of strategies has its own varieties.
The main advantages of options trading are as follows:
- high profitability of transactions - by paying a small premium for an option, in a favorable case, you can get a profit, which as a percentage of the premium is hundreds of percent;
— minimizing the risk for the buyer of the option by the amount of the premium with the possible receipt of theoretically unlimited profits.
The Russian derivatives market is today one of the most promising segments of the stock market. This is evidenced by the annual increase in market trade turnover and the emergence of ever new trading instruments. The most productive year in the history of the derivatives market was 2005.
In 2005, the total turnover of the Russian derivatives market exceeded 60.7 million contracts, or 907.3 billion rubles, which is 38.56 percent in contracts and 50.55 percent in monetary terms more than in 2004 ( table 7).
The leading roles in the derivatives market today are played by two stock giants - MICEX and RTS. The St. Petersburg exchanges, which previously occupied a significant market share, are far behind the leaders. At the end of the year, the total turnover on the St. Petersburg exchange, St. Petersburg Stock Exchange and St. Petersburg Stock Exchange amounted to less than 2 percent of the total trading volume of the Russian derivatives market.
In 2005, the range of derivative instruments in circulation was significantly expanded. The central event was the introduction into FORTS of futures and options on the RTS index, which is so far the only representative of the index derivatives segment on the Russian market. March 5, 2005 1-month options on futures for shares of Gazprom, RAO UES of Russia, LUKOIL and Rostelecom were put into circulation. This made it possible to significantly expand the capabilities of market participants in terms of constructing option strategies. On October 10, futures for ordinary shares of Sberbank began trading, which allowed RTS to increase the number of futures contracts for individual shares to seven and almost completely cover the blue chip segment. In addition, already in 2006. new contracts on interest rates have appeared in FORTS - futures on baskets of 3- and 10-year Moscow bonds and on Russia-30 Eurobonds. On June 8, 2006, futures trading for Urals oil and gold began on the FORST market. The launch of futures for oil and petroleum products will allow oil market participants to fix the purchase or sale price of oil in the future and thereby hedge against unfavorable price conditions.

During 2006, the Russian Trading System stock exchange, together with the Roshydromet Meteorological Agency, plans to launch weather futures contracts on the FORTS derivatives market. In addition, the possibility of launching other instruments is being considered, including ruble/euro futures contracts, futures on the spread of Russian Eurobonds to US Treasuries, as well as on a short-term ruble interest rate.
In 2006, the MICEX expects to launch an option on the US dollar exchange rate and introduce derivatives on interest rates, the underlying assets of which could be MosPime and MoslBOR, calculated by the National Monetary Association. Future plans include the launch of futures on the MICEX index, which will make it possible to compete with FORTS in the segment of index derivatives. Management's strategic plans include the development and implementation of derivative instruments for commodity assets - agricultural products, energy resources and other goods.
It can be noted that significant changes are taking place in the domestic derivatives market, transforming the previously narrow, specific segment of speculative trading into a full-fledged instrument of the Russian stock market. But, despite the dynamics of the changes taking place, the market volumes are extremely small. The main problem lies, first of all, in the lack of a legislative framework for the functioning of this market.
Today, there are no clear definitions of the rights and obligations of parties to transactions with derivative instruments, and there is no clarity on many issues of accounting and taxation of transactions. There is an urgent need to adopt a special law “On derivative financial instruments”, which will give a general definition of derivative instruments and definitions of the main types of such instruments, establish the rights and obligations of the parties to transactions with them, and determine acceptable underlying assets. The law should establish requirements for derivatives market participants, including requirements for capitalization and other reliability factors for intermediaries and infrastructure institutions. Also, at the legislative level, it is necessary to regulate mechanisms for protecting the rights of derivatives market participants (different for different instruments), including requirements for the settlement system, measures to ensure obligations, features of the formation and use of guarantee funds, requirements for risk management of market participants.
Unfortunately, the fate of bills in the field of futures trading leaves much to be desired. Almost 6 versions of the law were considered, but it all ended with the government, due to the continuous struggle around them, deciding to write negative conclusions to all versions of the law.
So, the main factor in the further successful development of the derivatives market in Russia is the creation of a strong legislative framework. Also, priority areas of market activity should include training qualified specialists with knowledge of the derivatives market; improvement of exchange trading technology; increasing the reliability of the risk management system and guarantees of fulfillment of obligations.

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Futures contract N ____
(Contract)


G._______________	"__" ____________ ____ G.

Hereinafter referred to as "Party 1", represented by ________________, acting__ on the basis of ________________ and a license dated "__" ____________ ____, issued by ________________, on the one hand, and ________________ represented by ________________, acting__ on the basis of ________________ and a license from "__" ____________ ____ city N ____, issued (name, address of the exchange), hereinafter referred to as "Party 2", on the other hand, equally referred to as "parties", entered into this agreement on the following at exchange trading on the ________________ exchange:

1. The Subject of the Agreement

1.1. Each of the parties to the contract is obliged to periodically pay amounts of money depending on changes in the price (prices) and (or) value (values) of the underlying asset and (or) the occurrence of a circumstance that is the underlying asset.

(Options:

a) also, Party 2 undertakes, in the event of a demand from Party 1, to transfer to it the underlying (underlying) asset, including by concluding an agreement by the party (parties) and (or) person (persons) in whose interests this agreement (contract) was concluded purchase and sale (supply) of exchange goods;

b) the parties are also required to enter into an agreement that is a derivative financial instrument and constitutes the underlying (underlying) asset.)

1.2. Underlying asset: securities (currency, commodity): ________________.

1.3. Range of price changes of the underlying (underlying) asset for premium payment:

1.3.1. If the price increases by at least ________ points (percent, etc.), a premium in the amount of ________________ rubles is paid by Party 2 (or Party 1).

1.3.2. If the price increases above ____________ points (percentage, etc.), a premium in the amount of ____________ rubles is paid by Party 2 (or Party 1).

1.3.3. If the price decreases by ____ points (percentage, etc.), a premium in the amount of ____________ rubles is paid by Party 2 (or Party 1).

1.3.4. If the price decreases by at least ____________ points (percent, etc.), a premium in the amount of ____________ rubles is paid by Party 2 (or Party 1).

1.4. Range of price changes of the underlying (underlying) asset for repurchase (or: sale):

1.4.1. Increase in price by no less than ____________ points (percent, etc.).

1.4.2. Price increase over ____________ points (percentage, etc.).

And the current reality of trading these instruments.

What is a futures in simple words

is a contract to purchase or sell an underlying asset within a predetermined time frame and at an agreed price, which is fixed in the contract. Futures are approved on the basis of standard conditions that are formed by the exchange itself where they are traded.

For each underlying asset, all conditions (delivery time, place, method, etc.) are set separately, which helps to quickly sell the assets at a price close to the market.

Thus, secondary market participants have no problem finding a buyer or seller.

To avoid the refusal of the buyer or seller to fulfill obligations under the contract, a condition is established for the provision of collateral by both parties.

Now it is not the economic situation that dictates the price of futures contracts, but they, by forming the future price of supply and demand, set the pace of the economy.

What is a Futures or Futures Contract?

(from the English word future - future), is a contract between a seller and a buyer providing for the delivery of a specific good, stock or service in the future at a price fixed at the time the futures contract is entered into. The main goal of such instruments is to reduce risks, secure profits and guarantee delivery “here and now.”

Today, almost all futures contracts are settled, i.e. without obligation to supply actual goods. More on this below.

First appeared on the commodity market. Their essence lies in the fact that the parties agree on a deferred payment for the goods. At the same time, when concluding such an agreement, the price is agreed upon in advance. This type of contract is very convenient for both parties, as it allows you to avoid situations where sharp fluctuations in quotes in the future will provoke additional problems in setting prices.

, as financial instruments, are popular not only among those who trade various assets, but also among speculators. The thing is that one of the varieties of this contract does not imply actual delivery. That is, a contract is concluded for a product, but at the time of its execution, this product is not delivered to the buyer. In this respect, futures are similar to other financial market instruments that can be used for speculative purposes.

What is a futures contract and for what purposes is it used? Now we will reveal this aspect in more detail.

“For example, I want futures for some shares that are not on the broker’s list” is the classic understanding from the Forex market.

Everything is a little different. It is not the broker who decides which futures to trade and which not. This is decided by the trading platform on which trading is conducted. That is, the stock exchange. Sberbank shares are traded on the MB - a very liquid chip, so the exchange provides the opportunity to buy and sell futures on Sberbank. Again, let's start with the fact that all futures are actually are divided into two types:

Calculated.
Delivery.

A settled future is a future that does not have delivery. For example Si(dollar-ruble futures) and RTS(futures on our market index) are settlement futures, there is no delivery for them, only settlement in cash equivalent. Wherein SBRF(futures on Sberbank shares) - delivery futures. It will supply shares. The Chicago Exchange (CME), for example, has deliverable futures on grain, oil and rice.

That is, if you buy oil futures there, they can actually bring you barrels of oil.

We just don’t have such needs in the Russian Federation. To be honest, we have a whole sea of “dead” futures, for which there is no turnover at all.

As soon as there is a demand for delivery of oil futures on the MB - and people are ready to transport barrels with Kamaz trucks - they will appear.

Their fundamental difference is that when the expiration date arrives (the last day of the futures circulation), no delivery occurs under settlement contracts, and the futures holder simply remains “in the money.” In the second case, the actual delivery of the basic tool occurs. There are only a few delivery contracts in the FORTS market, all of which provide delivery of shares. As a rule, these are the most liquid shares of the domestic stock market, such as: , and others. Their number does not exceed 10 items. Deliveries under oil, gold and other commodity contracts do not occur, that is, they are calculated.

There are minor exceptions

but they relate to purely professional instruments, such as options and low-liquid currency pairs (currencies of the CIS countries, except for the hryvnia and tenge). As mentioned above, the availability of deliverable futures depends on the demand for their delivery. Sberbank shares are traded on the Moscow Exchange, and this is a liquid chip, so the exchange provides the opportunity to buy and sell futures for this share with delivery. It’s just that we, in Russia, do not have the needs for such a prompt supply of gold, oil and other raw materials. Moreover, on our exchange there is a huge number of “dead” futures, for which there is no turnover at all (futures for copper, grain and energy). This is due to banal demand. Traders do not see any interest in trading such instruments and, in turn, choose assets that are more familiar to them (dollar and shares).

Who issues futures

The next question that a trader may have is: who is the issuer, that is, puts futures into circulation.

With shares, everything is extremely simple, because they are issued by the company itself that originally owned them. At the initial offering, they are bought by investors, and then they begin circulation on the familiar secondary market, that is, on the stock exchange.

In the derivatives market everything is even simpler, but it is not entirely obvious.

A futures is essentially a contract that is entered into by two parties to a transaction: buyer and seller. After a certain period of time, the first undertakes to buy from the second a certain amount of the underlying product, be it shares or raw materials.

Thus, traders themselves are the issuers of futures; the exchange simply standardizes the contract they enter into and strictly monitors the fulfillment of duties - this is called.

This begs the next question.

If everything is clear with shares: one delivers shares, and the other acquires them, then how should things stand with indices in theory? After all, a trader cannot transfer the index to another trader, since it is not material.

This reveals another subtlety of futures. Currently, for all futures, , which represents the trader’s income or loss, is calculated relative to the price at which the transaction was concluded. That is, if after the sale transaction the price began to rise, then the trader who opened this short position will begin to suffer losses, and his counterparty, who bought this futures from him, on the contrary, will receive a profitable difference.

A fixed-term contract is actually a dispute, the subject of which can be anything. For indexes, hypothetically, the seller should simply provide an index quote. Thus, you can create a future for any amount.

In the USA, for example, weather futures are traded.

The subject of the dispute is limited only by the common sense of the exchange organizers.

Do such contracts make any financial sense?

Of course they do. The same American weather futures depends on the number of days in the heating season, which directly affects other sectors of the economy. One way or another, the market continues to perform one of its main tasks: the accumulation and redistribution of funds. This factor plays a huge role in the fight against inflation.

The history of futures

The futures contract market has two legends or two sources.

Some believe that futures originated in the former capital Japan city Osaka. Then the main traded “instrument” was rice. Naturally, sellers and buyers wanted to insure themselves against price fluctuations and this was the reason for the emergence of this type of contract.
The second story says, like most other financial instruments, the history of futures began in the 17th century Holland when Europe was overwhelmed " tulip mania" The onion cost so much money that the buyer simply could not buy it, although some part of the savings was present. The seller could wait for the harvest, but no one knew what it would be like, how much he would have to sell and what to do in case of a crop failure? This is how deferred contracts arose.

Let's give a simple example . Suppose the owner of a farm is engaged in growing wheat. In the process of work, he invests money in the purchase of fertilizers, seeds, and also pays employees. Naturally, in order to continue, the farmer must be confident that all his costs will be recouped. But how can you get such confidence if you cannot know in advance what the prices for the crop will be? After all, the year may be fruitful and the supply of wheat on the market will exceed demand.

You can insure your risks using futures. The farm owner can conclude in 6 or 9 months at a certain price. Thus, he will already know how much his investment will pay off.

This is the best way to insure price risks. Of course, this does not mean that the farmer unconditionally benefits from such contracts. After all, situations are possible when, due to severe drought, the year will be lean and the price of wheat will rise significantly above the price at which the contract was concluded. In this case, the farmer will not be able to raise the price, since it is already fixed under the contract. But it is still profitable, since the farmer has already included his expenses and a certain amount in the price established under the contract. profit.

This is also beneficial for the buying side. After all, if the year is bad, the buyer of the futures contract will save significantly, since the spot price for raw materials (in this case, wheat) can be significantly higher than the price under the futures contract.

A futures contract is an extremely significant financial instrument that is used by the majority of traders in the world.

Translating the situation into today's terms and taking as an example Urals or Brent , a potential buyer approaches the seller with a request to sell him a barrel with delivery in a month. He agrees, but not knowing how much he can earn in the future (quotes may fall, as in 2015-2016), he offers to pay now.

The modern history of futures dates back to 19th century Chicago. The first product for which such a contract was concluded was grain. Initially, farm owners brought grain or livestock to Chicago and sold it to dealers. At the same time, the price was determined by the latter and was not always beneficial to the seller. As for buyers, they were faced with the problem of delivery of goods. As a result, the buyer and seller began to do without dealers and enter into contracts with each other.

What is the work plan in this case? She could be next - the owner of a farm was selling grain to a merchant. The latter had to ensure its storage until its transportation became possible.

The merchant who purchased the grain wanted to insure himself against price changes (after all, storage could be quite long, up to six months or even more). Accordingly, the buyer went to Chicago and entered into contracts with a grain processor there. Thus, the merchant not only found a buyer in advance, but also ensured an acceptable price for grain.

Gradually, such contracts gained recognition and became popular. After all, they offered undeniable benefits to all parties to the transaction.

For example, a grain buyer (merchant) could refuse the purchase and resell his right to another.

As for the farm owner, if he was not satisfied with the terms of the transaction, he could always sell his supply obligations to another farmer.

Attention to the futures market was also shown by speculators who saw their benefits in such trading. Naturally, they were not interested in any raw materials. Their main goal is to buy cheaper in order to later sell at a higher price.

Initially, futures contracts only appeared on grain crops. However, already in the second half of the 20th century they began to be concluded on live cattle. In the 80s, such contracts began to be concluded on precious metals, and then to stock indices.

As futures contracts evolved, several issues arose that needed to be addressed.

Firstly, we are talking about certain guarantees that contracts will be fulfilled. The task of guaranteeing is taken over by the exchange on which futures are traded. Moreover, here development went in two directions. Special reserves of goods and funds were created at the exchanges to fulfill obligations.
On the other hand, resale of contracts has become possible. This need arises if one of the parties to a futures contract does not want to fulfill its obligations. Instead of refusing, it resells its right under the contract to a third party.

Why has futures trading become so widespread? The fact is that goods carry certain restrictions for the development of exchange trading. Accordingly, to remove them, contracts are needed that will allow you to work not with the product itself, but only with the right to it. Under the influence of market conditions, owners of rights to goods can sell or buy them.

Today, transactions in the futures market are concluded not only for commodities, but also for currencies, stocks, and indices. In addition, there are a huge number of speculators here.

The futures market is very liquid.

How futures work

Futures, like any other exchange asset, have their own price and volatility, and the essence of how traders make money is to buy cheaper and sell more expensive.

When a futures contract expires, there may be several options. The parties keep their money or one of the parties makes a profit. If by the time of execution the price of the commodity rises, the buyer receives a profit, since he purchased the contract at a lower price.

Accordingly, if at the time of execution the price of the commodity decreases, the seller receives a profit, since he sold the contract at a higher price, and the owner receives some loss, since the exchange pays him an amount less than for which he bought the futures contract.

Futures are very similar to options. However, it is worth remembering that they do not provide the right, but rather the obligation of the seller to sell, and the buyer to buy a certain volume of goods at a certain price in the future. The exchange acts as a guarantor of the transaction.

Technical points

Each individual contract has its own specification, the main terms of the contract. Such a document is secured by the exchange. It reflects the name, ticker, type of contract, volume of the underlying asset, circulation time, delivery time, minimum price change, as well as the cost of the minimum price change.

Concerning settlement futures, they are of a purely speculative nature. Upon expiration of the contract, no delivery of goods is expected.

It is settlement futures that are available to all individuals on exchanges.

Futures price– this is the contract price at a given time. This price may change until the contract is executed. It should be noted that the price of a futures contract is not identical to the price of the underlying asset. Although it is formed based on the price of the underlying asset. The difference between the price of the futures and the underlying asset is described by terms such as contango and backwardation.

The price of the futures and the underlying asset may differ(despite the fact that by the time of expiration this difference will not exist).

Contango— the cost of the futures contract before expiration ( expiration date of futures) will be higher than the value of the asset.
Backwardation- the futures contract is worth less than the underlying asset
Basis is the difference between the value of the asset and the futures.

The basis varies depending on how far away the contract expiration date is. As we approach the moment of execution, the basis tends to zero.

Futures trading

Futures are traded on exchanges such as the FORTS exchange in Russia, or the CBOE in Chicago, USA.

Futures trading enables traders to take advantage of numerous benefits. These include, in particular:

access to a large number of trading instruments, which allows you to significantly diversify your asset portfolio;
the futures market is very popular - it is liquid, and this is another significant plus;
When trading futures, the trader does not buy the underlying asset itself, but only a contract for it at a price that is significantly lower than the value of the underlying asset. We are talking about warranty coverage. This is a kind of deposit that is charged by the exchange. Its size varies from two to ten percent of the value of the underlying asset.

However, it is worth remembering that warranty obligations are not a fixed amount. Their size may vary even when the contract has already been purchased. It is very important to monitor this indicator, because if there is not enough capital to cover them, the broker may close positions if there are not enough funds in the trader’s account.

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