Contracts for the future delivery of a commodity, financial asset, or financial index. A forward contract involves two parties fixing a price to be paid upon delivery at a specified date in the future. For example, it may be agreed that a price of $50 per barrel will be paid for Brent crude to be delivered in six months’ time. The party who is ‘long’ in the forward takes delivery from the party who is ‘short’. A forward contract locks in the price for future delivery, and can be used for hedging or for speculation. Futures are similar in concept but are organized, and regulated, by exchanges. A futures contract also requires the deposit of margin and is settled daily to limit the possibility of default. Very few futures contracts result in delivery taking place. Most positions are closed out by a reversing trade. See also Chicago Board of Trade; Chicago Mercantile Exchange; CME Group.