Whats the difference between a stock exchange and a futures exchange?
At a stock exchange, the stocks bought and sold represent partial ownership in the company, which originally issued the stock. At a futures exchange, contracts are bought and sold. The contracts are standardized as to quality, quantity and delivery time and location. The only variable is price, which is “discovered” in trading on the exchange floor. The contracts represent the intent to accept or deliver a quantity of a commodity, for example, corn, soybeans, or Treasury bonds, at some future date.
