Forex futures are traded by making contracts to exchange one currency for another at a specified date in the future date. Exchange rates and trading amount are also fixed on the purchase date. Forex futures are traded via exchanges, such as the CME (Chicago Mercantile Exchange). The underlying exchanging object of forex futures are forex exchange rates, such as the Euro to US Dollar exchange rate, or US Dollar to Japanese yen exchange rate. Forex futures are traded exactly the same way like other futures markets.
Forex future is a derivative of forex. There are some differences forex future and spot forex. Today I will list some of the most distinguished differences as follows for your reference.
Difference No.1 between spot forex and forex futures:
Forex futures traders are able to use forex futures to hedge against losses brought by forex market volatility. In spot forex, traders need to experience every up and down of forex market.
Difference No.2 between spot forex and forex futures:
Trading Forex futures need to pay commissions but in spot forex trading, forex traders only needs to pay for spreads.
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