»Ê¹ÚÌåÓýapp

Examples explaining the definition of ‘future�

Example 1

A company buys a number of exchange-traded wheat futures contracts. »Ê¹ÚÌåÓýapp contract specification provides that the holder of the contract can opt to take physical delivery of the wheat. »Ê¹ÚÌåÓýapp company has no intention of taking physical delivery and in fact closes out its position before the maturity date of the contracts. »Ê¹ÚÌåÓýapp contracts are nevertheless futures for the purposes of Part 7 CTA09, since they provide for the possibility of the specified property being delivered.

Example 2

A company buys a number of exchange-traded weather futures. »Ê¹ÚÌåÓýappse are settled by a cash sum which the company must either pay or receive depending on the difference between the average temperature for a given month and a reference level. Ambient temperature is not property which is capable of being delivered, so for the purposes of Part 7 these instruments are only relevant contracts if they as CFDs (contracts for differences), see CFM50380.