Spot market, and its difference from other markets
Spot market is an economic site where any assets (currency units, securities, raw materials) are selling and buying solely for cash in accordance with terms of fast providing. All financial markets, despite of their specifications, can be divided into 2 main varieties: futures market and spot market. The first market implies the fulfillment of transactions agreed by the two parties in a certain compromise period. The second type, spot market, often called as cash market. Their main feature is deal is negotiated on the basis of the latest actual value of the asset, which was fixed during the definition of the contractual terms. By visiting website hqbroker.com you can conduct deals on silver and gold spot.
Spot market. Key specifics
Spot market can be characterized by following specifics:
1. A spot contract and confirmation of purchase or sale is made and paid within 2 working days;
2. The formation of the value of an asset is directly related to the ratio of supply and demand on it;
3. The level of volatility is much higher than the indicators of the derivatives market;
4. The interest rate on the asset price is not provided;
5. Quotations of the exchange rate are fixed and unified;
6. Lot of transactions performed through modern automated computer systems.
Similarities and differences between futures market and spot market
Both futures and spot markets have a number of common features. First of all, it is basing on economic fundamentals. Both markets are guided by same concepts of price formation and competition rules. Also in the legislative sphere, they are regulated by the same regulatory and legal acts. Go to the www hq online and company’s specialists will provide you all necessary information about financial markets.
Both the urgent and the spot market have a similar infrastructure base, they use the same technological approaches and electronic global systems. However, a number of organizational similarities do not make them completely identical, which is the reason for the combination of their fundamental differences in trading.
Spot market provides for the functioning of only real assets, which are immediately provided for use. At the same time, traders in the futures market have the opportunity to use futures contracts, as well as options or other financial instruments.
You can trade futures on shares, metals and commodities after opening trading account at HQ Broker. Skillful traders are able to combine the advantages of both markets and to obtain maximum privileges from them. The main thing is to learn in a timely manner to select immediate or delayed trading operations.
Start trading online with an international regulated Broker. Trader Forex, spot metals and Derivatives on major commodities, world stock indices and equity shares. Get Started!
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