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what exactly are futures?

This is a discussion on what exactly are futures? within the Futures forums, part of the Financial Markets category; Hello guys and girls. i am a total newbie in the futures field. i was reading their terms and conditions ...

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Old May 28, 2009, 3:31pm   #1
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Wink what exactly are futures?
Hello guys and girls.
i am a total newbie in the futures field.

i was reading their terms and conditions at Risk Disclosure Notice IG Markets

Transactions in futures involve the obligation to make, or to take delivery of the underlying asset of the contract at a future date, or in some cases to settle your position with cash. They carry a high degree of risk. The "gearing" or "leverage" often obtainable in futures trading means that a small deposit or down payment can lead to large losses as well as gains. It also means that a relatively small market movement can lead to a proportionately much larger movement in the value of your investment, and this can work against you as well as for you.

does that mean if i buy a brent oil i take full ownership and i have to pay the full price?
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Old May 28, 2009, 3:46pm   #2
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only if you hold it untill it expires. you just sell the contract before it expires
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Old May 28, 2009, 3:58pm   #3
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Quote:
Originally Posted by snitcher View Post
i am a total newbie in the futures field.

i was reading their terms and conditions [...]

does that mean if i buy a brent oil i take full ownership and i have to pay the full price?
Yes.

I can arrange transport and storage for a small fee.
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Old May 28, 2009, 3:59pm   #4
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snitcher started this thread ok so what if i do not want that asset and only want the profit(or loss)?
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Old May 28, 2009, 4:13pm   #5
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If you want the profit I can similalry arrange for transport and (very temporary) storage in a 3rd party country exempt from any taxation agreements with your own domicile nation.

Alternatively, take physical delivery and I may be able to put you in touch with someone, for a small fee, who could take it off your hands - providing certain quid pro quo of counter-party produtcs and services could be nominally exchanged for face value equivalent to and as agreed upon with your goodself.

The loss is an option - if you tick the 'no losses' box when you place the order it will overide the default setting which is 'liable for losses'.

hth
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Old May 28, 2009, 4:28pm   #6
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Originally Posted by snitcher View Post
ok so what if i do not want that asset and only want the profit(or loss)?
Exit your position before expiry of the contract.

Simples.
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Old May 28, 2009, 4:29pm   #7
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Originally Posted by TheBramble View Post
If you want the profit I can similalry arrange for transport and (very temporary) storage in a 3rd party country exempt from any taxation agreements with your own domicile nation.

Alternatively, take physical delivery and I may be able to put you in touch with someone, for a small fee, who could take it off your hands - providing certain quid pro quo of counter-party produtcs and services could be nominally exchanged for face value equivalent to and as agreed upon with your goodself.

The loss is an option - if you tick the 'no losses' box when you place the order it will overide the default setting which is 'liable for losses'.

hth
He He
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Old May 28, 2009, 4:37pm   #8
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Quote:
Originally Posted by TheBramble View Post
If you want the profit I can similalry arrange for transport and (very temporary) storage in a 3rd party country exempt from any taxation agreements with your own domicile nation.

Alternatively, take physical delivery and I may be able to put you in touch with someone, for a small fee, who could take it off your hands - providing certain quid pro quo of counter-party produtcs and services could be nominally exchanged for face value equivalent to and as agreed upon with your goodself.

The loss is an option - if you tick the 'no losses' box when you place the order it will overide the default setting which is 'liable for losses'.

hth
very helpful
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