[期货]Chapter 5 The Variety of Futures Markets.pptVIP

Chapter 5The Variety of Futures Markets Even though the CBOT was established in 1848, a formal set of rules for trading futures contracts was not written until 1865, which is a more accurate date from which to mark the beginning of futures trading in the United States. Chicago Mercantile Exchange (CME) Proliferation of Futures Markets Futures and futures options trading has been growing steadily in volume yearly. This explosive growth has been a natural response to increased price volatility, international instability, growing consumer demand, and unstable global weather conditions. Hurricane Jeanne In 1972 the CME established the International Monetary Market (IMM) division and initiated trading in seven foreign currency futures contracts. How do we develop a currency futures contract ? If I am an automobile distributor, and I place an order for 20 million dollars worth of German cars to be delivered three months, I face the risk that when I pay for the cars the value of the Euro, which I must use to pay the manufacturer, may have gone up in relationship to the dollar. How do we develop a currency futures contract ? In other words, when I order the cars, my U.S. dollar is worth a certain number of Euro, a value we will call X. How do we develop a currency futures contract ? In the event that the Euro has decreased against the U.S. dollar the opposite condition will hold true. How do we develop a currency futures contract ? The Euro might drop in value, meaning I could buy more Euro with U.S. dollars three months hence. An Overview of Market Sectors Foreign Currency Futures In order to hedge against fluctuations in currency relationships, a producer can use foreign currency futures as his or her vehicle. Interest Rate Futures Interest rate volatility represents a large risk to businesses and investors who count the interest earned or paid on borrowed money as a source of profit or expense. Interest Rate Futures If I a