The information that futures traders are most concerned about must be the delivery and exchange of futures contracts , and most of the newcomers who are new to futures trading must not know much about it. So today, we will talk about futures with you. It's full, remember to favorite and share~
What is the main futures contract
When we look at the futures market, we will find that each futures variety has more than one contract. Take cotton futures as an example:
As can be seen from the above picture, the cotton futures contract not only has the word cotton, but also a string of numbers, which is the delivery month of the futures . For example, cotton 2205 refers to the cotton futures contract for delivery in May 2022.
Since futures are "goods of the future", that is, we will buy something in the future now, such as cotton. So the month of the futures contract ≥ the current month .
Futures delivery refers to the process in which when the futures contract expires, the two parties to the transaction settle the expired open contracts through the transfer of the ownership of the commodities contained in the futures contract. There are two types of delivery methods: cash delivery and physical delivery . Domestic commodity futures are mainly physical delivery. If we hold a long position in the cotton 2205 contract until May, then we will carry out delivery and pay the corresponding fees to collect physical cotton. .
But delivery is generally what traders, or spot companies, do, and speculators (such as futures traders like us) often unwind the contract for the month before delivery.
specific time of delivery
Or take cotton as an example:
We can see from the above picture that the last delivery day of cotton is the 13th trading day of the contract delivery month, that is to say, cotton 2205 will be delivered before the 13th trading day of May.
We can see that there is also a "last trading day" in the above picture, that is, the last trading date of this contract is the 10th trading day of May, after which it cannot be traded and the delivery will begin.
There are certain differences between the last trading day and the last delivery day of different varieties. You can click [F10] of the specific variety in the futures company APP to view.
What is the main contract
The main futures contract is the contract that is most active in the market and is also the most traded by speculators. Generally speaking, we measure activity by volume or open interest . Contracts that are not the main force have relatively poor activity, and the price may have a significant gap.
We saw the picture just now, under the cotton 2205 and cotton 2209, there are two words [main] and [secondary] respectively, representing the main contract and the sub-main contract. The sub-main contract is the contract of the most active month in addition to the main contract.
Different varieties, the main force of the month will be different, for example, the main force of cotton is generally in May or September, the main force of rebar is generally in May or October, and the main force of some non-ferrous metals is in the next month of the month. , there will be a new main contract every month.
The main contract will not always exist , such as the 2205 contract, which will not exist after delivery. This involves the issue of the main force changing month.
What is the main force
We know that the standard to consider whether it is the main contract is the volume or open interest, then when the volume or open interest of a contract in a certain month gradually decreases, and the transaction volume or open interest in another month gradually increases, it may be the main contract. changed.
The definition of the main contract is not as clear as the "last trading day", but based on the transaction activity. Therefore , on any day before the last trading day, if the activity of the other month's contract exceeds the current main contract, the main contract will be The contract has changed .
For speculators, if we are making long-term investments and want to hold a certain contract before and after the main force changes, then we need to change the month.
The actual operation of the month swap is to close the existing main contract position, and then open a position in the next main contract (maybe the second main contract now). This process may result in a large cost, because the prices of different months are not continuous, and there may be a large price difference in the middle, so when we change the month (especially in the real market), we must determine the specific price according to the actual market situation. When to change the month.