Futures contracts are agreements to buy or sell a standardized asset at a specific future time

Futures contracts are the primary way commodities are bought and sold

Selling futures contracts protects both parties from future fluctuations in pricing. It allows sellers of commodities to lock in some of their output, even if prices fall. Traders can eliminate some of the volatility inherent in commodities trading via these contracts.

Commodity trading is regulated by the CFTC to mitigate fraud and risk

Established in 1974, the CFTC regulates these markets (including swaps, futures, and certain types of options) to protect market participants from fraud, ensure fair trading conditions, and generally reduce financial risk.

How exchanges like the Chicago Mercantile act as trading referees

Chicago's Mercantile Exchange emphasizes futures contracts on commodities. This podcast episode breaks down how exchanges actually work, make money, and streamline the market.

Commodity traders are most commonly 'hedgers' or 'speculators'

While hedgers often produce and consume physical commodities (like corn, copper, or natural gas) and use the markets to manage the price risk for those commodities, speculators provide liquidity by betting on commodity price changes.

The 'commodities' investment category includes livestock, oil, wheat, and more

Commodities traders look at all of these things as assets, placing short-, medium-, and long-term wagers on how much each is really worth. Commodities are valuable in part due to how essential they are in creating most of the world's marketable goods.

Prediction markets convinced regulators they're not gambling, but exchanging commodity futures contracts

Kalshi built a legal case that argues its yes/no bets on real-world events are futures contracts, and the relevant regulator—the Commodity Futures Trading Commission—agreed in 2020. Many states are now suing major prediction markets, arguing this legal case is faulty and obscures the true substance of the business: gambling.

Commodities have to meet specific specifications to be classified as commodities

In the financial sense of the term, commodities must be uniform, interchangeable, and deliverable to meet the classification. That's partly why a crop grown in your backyard might not qualify as a commodity crop.

Spot markets are where commodities intended for relatively immediate delivery are traded

Spot markets are where physical securities are exchanged for cash. Also known as cash markets or physical markets, the trades are relatively immediate—both parties agree to an immediate transfer. Currencies and securities can also be traded on spot markets.

Contract prices on prediction markets are generally interpreted as implied probabilities

For example, if a contract trading is at $0.65, that could be read as the market assigning a 65% probability to that event occurring. The most common format for prediction markets is winner-take-all: The contract settles at $1 if the event occurs, or $0 if it doesn't.

Call options 101

A call option is a contract that gives the option buyer the right to buy an underlying asset at a specified price within a specific time period. A call buyer profits when the underlying asset increases in price. Learn more about the financial contract and how you can use it in this article.

There's a grading room on the eighth floor of the New York Stock Exchange where experts loudly slurp coffee and then spit it out to test its quality

Since many agricultural commodities are traded through futures, testers ensure that the physical product that reaches the market accurately reflects the price. Coffee graders at the NYSE have to pass a four-day-long exam that's only offered every five years and has a less than 10% pass rate.

What are repurchasing agreements?

Repurchasing agreements are short-term trade agreements in which a dealer sells securities and agrees to repurchase them at a higher price soon after (often within 1 to 2 days). This gives dealers quick access to cash and allows the purchasing party, often the Federal Reserve, to control liquidity in securities. This can be used to alter the money supply, which is a key element in combating deflation.

What are smart contracts?

Smart contracts are potentially one of the most useful tools associated with blockchain, and they can enable the transfer of everything from Bitcoin and fiat currency to goods transported around the world. Here’s what they do and why they’re likely to gain traction.

Shorting is a high-risk and expensive investment strategy that hedge funds specialize in

Most investors buy stocks with the expectation that those stocks will be worth more tomorrow than they are today. Short selling, known as “shorting,” a stock is the opposite: The investor is betting the stock will drop in value.

The CME FedWatch Tool predicts the likelihood of future rate changes

It's based on federal fund futures contract prices. At a Fed meeting in July 2024, for instance, Chair Jerome Powell once again decided not to lower rates, though he said cuts could be on the table in September.

The different types of stablecoins include algorithmic stablecoins

In addition to fiat-backed stablecoins, commodity-backed stablecoins, and cryptocurrency-backed stablecoins, algorithmic stablecoins use smart contract-based mechanisms to maintain a stable value by responding to supply and demand.

ETFs vs. mutual funds: Which are better investments?

Exchange-traded funds and mutual funds have many similarities. They both invest in multiple companies under one fund and trade using the same securities (such as stocks and bonds). However, they have distinct differences—such as fees and management style—that can impact your bank account in the long term.

Annuities are financial products typically used by retirees looking for guaranteed income streams

Specifically, annuities are contracts between an individual and an insurance company that require the insurance company to make regular payments to the individual.

Certificates of deposit are investment vehicles that earn interest on a fixed sum of money over a set term

CDs come in varying term lengths, from three- or six-month commitments to decadelong terms. Typically, the longer the term, the higher the interest rate.

While the first exchange-traded fund (a 'basket' of different assets that can be bought and sold on a stock exchange) in the US only launched in 1993, the global ETF market has grown to more than $10T in the short time since.

Fannie Mae and Freddie Mac are federal housing enterprises originally established to offer affordable housing loans to buyers

The Federal National Mortgage Association is commonly called Fannie Mae, and the Federal Home Loan Mortgage Corporation is called Freddie Mac. Since Fannie Mae’s creation in 1938 and Freddie Mac’s in 1970, they’ve become staples of the housing market.

Hedge funds, the private investment firms that trade a wide swath of financial assets, make money by imposing steep fees on investors and from the fund's investment performance.

Bullion is either gold or silver that has at least 99.5% or 99.9% purity, respectively

It’s typically kept in the form of bars or ingots. Governments and central banks often keep bullion reserves on hand; they can use it as a hedge against inflation. One can invest in bullion via ETFs, among other financial vehicles.

What are tariffs and how do they work?

Tariffs are taxes on imported goods paid by importing companies but typically passed on to consumers. They vary by country and product and, despite recent spikes, have historically accounted for less than 2% of federal revenue. Explore more with these data visualizations from USAFacts.

Real estate investment firms handle enormous, complex real estate transactions

In the large-scale projects real estate investment firms handle (such as huge commercial developments), the parties involved in a sale are more likely to be large corporate real estate developers and investors than individuals.

Why consumers could soon see the impact of buy now, pay later loans on their FICO credit scores

FICO rolled out its first-ever BNPL-specific credit scoring models in June 2025. While missed installments can now negatively impact a credit score, there's also the potential for on-time BNPL installment payments to help boost scores.

The fall is the best time of year to buy a car

The months of October through December are generally considered the best time to buy a car because old inventory is getting pushed out the door to make room for new cars. In addition to those months, some days of the week are considered better for car buying than others. To find out more, read this article.

The US dollar is the most widely circulated currency in the world, and is involved in nearly 90% of global transactions

Sunflowers have long been a symbol of nuclear disarmament because they can extract large amounts of radioactive cesium from soil.

While atoms are normally made of protons, neutrons, and electrons, exotic ones have been built with antimatter—alternate versions of normal matter that live for fractions of a second and are about a billion times as rare.

Chaos theory—informally known as the butterfly effect—is the reason why weather forecasts are presented with probabilities rather than certainties.

Objects can be 3D printed with light by projecting 2D computerized tomography (CT) scans onto rotating cylinders of resin, which solidify upon exposure.

Researchers believe the brain consolidates memories, processes emotions, and plans for the future during dream states

Shooting stars, or meteors, are fragments of asteroids and comets that burn up as they enter Earth's atmosphere, creating streaks in the sky called meteor showers.

Doctors differentiate between a phobia and fear by asking patients whether their fear interferes with their day-to-day activities.

The first steps to rebuilding your credit score include getting to know exactly what's on your credit report and figuring out how far you are from the '700 club,' or 'good score' range.

Children are now three times more likely to say they want to be a YouTuber when they grow up than an astronaut, with some even attending 'YouTube camps' that teach kids how to create content for the platform.

Electrical grids worldwide must double their power delivery capacity by 2050 to meet surging demand from AI and electric vehicles.

Long before Major League Baseball began allowing instant replay for balls and strikes, an umpire reluctantly used the technology to determine whether a hit was a home run, a move that inadvertently ushered in a new era for the sport.

Domino's Pizza's 30-minute delivery guarantee was responsible for the chain's 1980s surge, but it was discontinued after the company was found liable for delivery driver accidents.

Use this tool to calculate the dollar value of your parental mental load, from meal planning to coordinating after-school care, then see resources that help generate solutions.

See this overview of the firework rules across all 50 states, ranging from a complete ban on non-professional fireworks in Massachusetts to states with more lax rules like Indiana.

In 2026, Finland was named the world's happiest country for the ninth consecutive year based on its wealth, social safety network, and high life expectancy, among other factors.

Browse a detailed visual analysis of over 200,000 similes—comparisons that often use 'like' or 'as'—from popular fiction to see how frequently writers the same idiomatic expressions.

The rivalry between Alexander Hamilton and Thomas Jefferson centered on federalism—the question of how much power the federal government should hold relative to the states.

Frank Lloyd Wright's houses are historically hard to sell because they're old, subject to local landmark commissions, and often unfashionable

The term 'algorithm' originated from the Latinized name of al-Khwārizmī, a 9th-century mathematician whose works introduced Arabic numerals and the decimal-based numeral system to Europe and whose treatise 'Al-Jabr' gave algebra its name.

To reduce wrinkles in clothing, research recommends gentle wash cycles with more water and tumble drying with smaller loads and longer times.

20,000 letters to the advice columnist 'Dear Abby' provide insight into prevailing sex, religion, and LGBTQ fears, anxieties, and concerns from the 1950s onward.

Quincy Jones' 'Big Band Bossa Nova' helped introduce bossa nova—a jazz-influenced Brazilian genre—to the US