Many times we read about Future Trading in newspapers. What is ‘Future Trading’ ?
(i) It is nothing but a trade between any two stock exchanges wherein it is decided to purchase the stocks of each other on a fixed price throughout the year.
(ii) It is an agreement between two parties to buy or sell an underlying asset in the future at a predetermined price.
(iii) It is an agreement between stock exchanges that they will not trade the stocks of each other under any circumstances in future or for a given period of time.