Because you control a large asset with a small deposit, small price changes can lead to significant gains or losses that may exceed your initial investment. Buying Example: The Cereal Manufacturer (Hedging)
Profits and losses are calculated and settled in your account at the end of every trading day. buy futures contract example
Every contract specifies the exact quantity and quality of the asset (e.g., one crude oil contract covers 1,000 barrels). Because you control a large asset with a