Financial futures
Financial futures are instruments that provide for the purchase or sale of a financial asset at some time in the future, but at a price that is established today. Financial futures exist for Treasury bills, Treasury notes and bonds, certificates of deposit, Eurodollar deposits, foreign currencies, and stock indexes.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Financial futures. Provide for the purchase or sale of a financial asset at some time in the future, but at a price that is established today. Financial futures exist for Treasury bills, Treasury notes and bonds, certificates of deposit, Eurodollar deposits, foreign currencies, and stock indexes.
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Financial futures. A contract that is used to hedge against fluctuating interest rates, stock prices, and exchange rates.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
