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A futures contract is a financial contract which either obligates the purchaser to buy an asset or the vendor to sell one, like commodity or a monetary instrument, at a pre-set and agreed upon future date for a concluded on price settled on today. Futures contracts spell out the quality and quantity of the underlying asset, and they are standardised so that futures exchanges can deal in the purchasing and selling of them. A futures contract might demand physical delivery of the underlying asset, or it would simply demand money settlement. It is awfully unusual for the underlying asset of a futures contract to really be delivered, as the contracts themselves are heavily traded and frequently used as hedges or speculative investing.
For the purposes of futures clearing, a clearing house or clearing firm is a specialized agency set up to help futures exchange trades and has the responsibilities of settling trading accounts, clearing trades, picking up and maintaining margin monies, controlling delivery and reporting trading info.
Each futures exchange has its own clearing house ( or "clearing firm" or "clearing corporation" ), and it deals in conjunction with that futures exchange in an analogous way of bank clearing homes. If there are members of the exchange who don't join the house's clearing organisation, they to clear their trades thru an association member. All members have to give the clearing house a deposit, which relies on that clearing house's margin wants, satisfactory to cover their member debit balance. Also, each clearinghouse member is required to put up fixed original margins and maintain them with the house should there be difficult price fluctuations. Indeed, under those circumstances, the clearing house could call for extra margins thru a trading day instead of holding out for the common end-of-day settlement.
So, under normal circumstances, shall we say a member reports buying two hundred thousand bushels of September corn and total sales of 100,000 bushels of September corn; that member is now net long 100,000 bushels of September corn. Let us also say that member's only position in corn futures and the clearing house margin is $.06 per bushel.
All members of the association must clear their trades thru the clearing house and thus have to maintain acceptable funds to cover their debit balances, making the clearing house responsible to every member for the fulfilment of all member contractual obligations.
A top quality futures clearing house or firm should have top bespoke risk management tools, sensitive margin requirements and maintenance, superior oversight of all traders' exposure, and a professional back room settlement department.
The Kyte Group offers <href="/links/?u=http://www.kytegroup.com/links/futuresclearing/7">futures clearing, options, money bonds, money equities, warrants, Foreign exchange,. Futures Clearing _Kyte Group Services [http://futuressettlementandclearing.wetpaint.com/].
A futures contract is a financial contract which either obligates the purchaser to buy an asset or the vendor to sell one, like commodity or a monetary instrument, at a pre-set and agreed upon future date for a concluded on price settled on today. Futures contracts spell out the quality and quantity of the underlying asset, and they are standardised so that futures exchanges can deal in the purchasing and selling of them. A futures contract might demand physical delivery of the underlying asset, or it would simply demand money settlement. It is awfully unusual for the underlying asset of a futures contract to really be delivered, as the contracts themselves are heavily traded and frequently used as hedges or speculative investing.
For the purposes of futures clearing, a clearing house or clearing firm is a specialized agency set up to help futures exchange trades and has the responsibilities of settling trading accounts, clearing trades, picking up and maintaining margin monies, controlling delivery and reporting trading info.
Each futures exchange has its own clearing house ( or "clearing firm" or "clearing corporation" ), and it deals in conjunction with that futures exchange in an analogous way of bank clearing homes. If there are members of the exchange who don't join the house's clearing organisation, they to clear their trades thru an association member. All members have to give the clearing house a deposit, which relies on that clearing house's margin wants, satisfactory to cover their member debit balance. Also, each clearinghouse member is required to put up fixed original margins and maintain them with the house should there be difficult price fluctuations. Indeed, under those circumstances, the clearing house could call for extra margins thru a trading day instead of holding out for the common end-of-day settlement.
So, under normal circumstances, shall we say a member reports buying two hundred thousand bushels of September corn and total sales of 100,000 bushels of September corn; that member is now net long 100,000 bushels of September corn. Let us also say that member's only position in corn futures and the clearing house margin is $.06 per bushel.
All members of the association must clear their trades thru the clearing house and thus have to maintain acceptable funds to cover their debit balances, making the clearing house responsible to every member for the fulfilment of all member contractual obligations.
A top quality futures clearing house or firm should have top bespoke risk management tools, sensitive margin requirements and maintenance, superior oversight of all traders' exposure, and a professional back room settlement department.
The Kyte Group offers <href="/links/?u=http://www.kytegroup.com/links/futuresclearing/7">futures clearing, options, money bonds, money equities, warrants, Foreign exchange,. Futures Clearing _Kyte Group Services [http://futuressettlementandclearing.wetpaint.com/].