ABSTRACT
A financial future is a notional commitment to buy or sell, on a specified future date, a standard quantity of a financial instrument at a price determined in the present (the futures price). It is rare for a futures contract to be used for the exchange of financial instruments. Indeed many contracts, including stock index futures, have no facility for the exchange of the financial instrument. Instead, financial futures markets are independent of the underlying cash markets, albeit operating parallel to those markets.
