New answers tagged futures
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You're confusing the value of the contract with the futures price. The futures price is set by the market - meaning it's whatever contract price you can get someone else to take the other side of. It is set for the life of the contract.
As other futures contracts are traded, though, the value of your contract goes up and down (and yes, becomes negative). If ...
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You are wrong in that a future contract is not an option contract. It has no strike, and the future contracts value is not a premium as there is no premium.
Imagine you order a PS5 online and it will be delivered to you in one month for a fixed price of $500. You pay $50 as an initial margin and get a contract. In one month the price rises to $1000 and you ...
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