They use futures contracts to speculate on the future price movements of commodities, currencies, and financial assets. Margin requirements vary depending on the contract, market volatility, and exchange, but are generally set at a percentage of the contract's value. "Jay quickly responded, "When you trade futures contracts, you need to keep in mind that they have an expiration date. The spread between contracts is accumulated and finally, a cumulative adjustment factor is determined based on which continuous contract price is adjusted. He can use a continuous contract that combines the prices of each crude oil futures contract for the past five years.

Source: Economic Times May 07, 2023 07:36 UTC