What is future options ?
A futures contract is an agreement to trade a specific underlying commodity or financial instrument for a specific price at a specific time in the future. For example, a pork bellies future is an agreement to trade 40,000 pound of frozen pork bellies weighing 12 to 18 pounds each on the business day immediately preceding the last 3 business days of the contract month at 12:00 p.m. http://www.cmegroup.com/trading/commodit… There are always two parties to a futures contract, one who will sell the underlying and one who will buy it. At settlement, all existing contracts will result in a trade of 40,000 pounds of pork bellies. —– An options contract is similar to a futures contract except that instead of the trade always taking place, with an options contract the trade will only take place if one of the parties decides he wants to make the trade. If it is the
