Quantitative Trading Strategies Using Python: Technical Analysis, Statistical Testing, and Machine Learning

© The Author(s), under exclusive license to APress Media, LLC, part of Springer Nature 2023

P. LiuQuantitative Trading Strategies Using Pythonhttps://doi.org/10.1007/978-1-4842-9675-2_3

3. Forward and Futures Contracts

Peng Liu¹  

(1)

Singapore, Singapore

 

In financial markets, forward and futures contracts serve as popular financial instruments for hedging risk (preventing or reducing potential loss) and speculation (seeking abnormal and risky profits). These contracts offer market participants the opportunity to mitigate or enlarge the impact of price fluctuations on their positions. The use of forward and futures contracts has grown exponentially over the years, as market participants increasingly recognize their potential benefits in risk management ...