Future (future transaction, more rarely future-related transaction)

Unconditional forward transaction, namely financial futures contract – sometimes also related to listed commodities, – which contains an obligation for both contracting parties to buy (long future) or sell (short future) a – financial product (underlying asset) – in a certain quantity – at an agreed price – on a fixed later date, according to IAS “a firm commitment traded on an organized market to buy or sell an agreed quantity of an asset at an agreed price on an agreed date.” – The buyer of the contract must buy the underlying financial product on the settlement date (long position), while the seller (writer) must deliver the financial product on the settlement date (short position). – Possible underlyings include – assets, such as primarily stocks, bonds, commodities, electricity, gas, precious metals, or – reference rates, primarily currencies, interest rates, and indices such as the Dax. – The terms of the contracts are usually standardized. This enables transparent trading on the exchange, low costs and simplified market access. – See markdown, crush spread, derivative transactions, bilateral, derivative transactionsClearing obligation, derivative transactionsReporting obligation, financialization, Kerviel scandal, low, option, position, weak, commodity futures contract, indemnity obligation, forward contract, underlying. – Cf. the definitions and classifications in the ECB’s Monthly Report of May 2000, p. 42; BaFin’s Annual Report 2002, p. 75 f. (with regard to information obligations of providers), Deutsche Bundesbank’s Monthly Report of October 2006, p. 31 ff. (with regard to bonds issued by the German federal government), Deutsche Bundesbank’s Monthly Report of June 2012, p, 34 f. (oil price futures).

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
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