What do contract specifications in futures trading outline?

• A. The risks associated with trading
• B. The different types of trades
• C. The details of the contract
• D. The market trends to follow

Answer: (C)

Contract specifications in futures trading provide crucial details about the terms and conditions of a futures contract. These specifications include information such as the underlying asset, contract size, tick size, expiration dates, and the trading hours. Understanding these specifications is essential for participants in the market, as they define the operational framework of the contract, ensuring that both buyers and sellers are clear on what is being traded and the rules governing that trade.

While risks associated with trading, types of trades, and market trends might be important aspects of futures trading, they do not fall under the purview of contract specifications. Instead, contract specifications are focused solely on the essential details that govern the transaction, establishing a standardized communication framework between market participants.