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Stock market futures are financial contracts that allow investors to buy or sell a particular stock at a predetermined price at a specific time in the future. They are traded on futures exchanges, such as the Chicago Mercantile Exchange (CME) and the Intercontinental Exchange (ICE).
Futures contracts are typically used by investors to hedge against market risks or to speculate on the future direction of stock prices. For example, if an investor is concerned that the stock market may decline, they can buy a futures contract to sell a particular stock at a fixed price at a later date. This allows the investor to lock in a profit or limit their potential losses if the stock price does indeed decline.
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