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Derivatives

Futures

Standardized contracts to buy or sell an asset at a future date and price.

In depth

Used for hedging (farmers, miners, airlines hedging input costs) and speculation. Futures are leveraged — you post margin (often 5-10% of contract value), and gains/losses are settled daily ("mark-to-market"). Major futures: S&P 500, crude oil, gold, currencies, Treasuries.

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