Futures are contracts that give the purchaser the option to buy a specified commodity at a specified price on a specified date in the future. Commodities traded this way include copper, gold, platinum, silver, crude oil, heating oil, gasoline, natural gas, corn, ethanol, oats, soybeans, soybean meal, soybean oil, rice, wheat, cattle, hogs, pork bellies, lumber, milk, cocoa, coffee, sugar, cotton, and orange juice.
Futures allow businesses to hedge their future needs for raw materials. This helps to smoothe out price fluctuations.
Related Fool Articles
- [link link title]
Recent Mentions on Fool.com
- Why Sony Stock Is Up More Than 35% In 2015
- Costco Climbs on Strong Earnings, But Will Future Growth Keep Up the Pace?
- Here's What the World's Biggest Hedge Fund Has Been Selling
- Oil Stocks: What Linn Energy's Latest Move Means for Future Dividend Growth
- Here's What the World's Biggest Hedge Fund Has Been Buying
- Will Costco Wholesale Earnings Extend the Winning Streak?