Stock Index Future

Stock Index Future

A security that uses composite stock indexes to allow investors to speculate on the performance of the entire market, or to hedge against losses in long or short positions. The settlement of the contracts is in cash.

Stock Index Future

A futures contract on a stock index. In a stock index future, the counterparties agree to trade the underlying index at a certain time for a certain price. Because it is impossible to physically deliver the index, stock index futures are settled in cash, especially if the underlying assets are indices. Financial futures may be traded like other futures.

stock index future

A contract for the future delivery of a sum of money based on the value of a stock index (in most cases, 500 times the index). Unlike other futures contracts, in which a given commodity is specified for delivery, stock index futures call for cash settlements, because it is not possible to deliver an actual index. This future can be used to speculate on the future direction of the stock market (rather than just a few stocks) or to hedge a portfolio of securities against general market movements. See also Section 1256 contracts.
References in periodicals archive ?
The impact of stock index future trading, on the volatility of the underlying Nifty and Nifty Junior stock index market, is investigated by estimating a model for a period which covers the time before and after the introduction of stock index futures contracts.
Second, as pointed out by Eun and Shim (1989, 243), despite the nonsynchronous nature of the data employed, the results of VAR analysis based on the structure of time zone differences can still provide useful insights into the international transmission mechanism of stock index future market movements.
A stock index future is just like a port belly future, only instead of being a commitment to buy pork, it's a commitment to buy a "basket" of stocks.
And yet today's trader has to know precisely how to compare the cost of an ETF to the cost of the underlying basket, all the while needing to understand financing and volatility charges included in the price of a swap transaction and the richness/cheapness of roll risk in the calendar spread on the stock index future.
In the case of a stock index future, speculatorsbet that a group of stocks is going to go up or down in value.
US stock index futures pointed to further gains on Wall Street on Monday as investors grow more confident in the strength of the recovery in the world's biggest economy.
Previously published under the title Security Analysis and Portfolio Management, this advanced textbook for a second investment course introduces Markowitz's model of portfolio selection and the arbitrage pricing theory, and applies the financial theories to commodity futures, stock index futures, and stock options.
China launched its Hushen 300 index, the first stock index futures to begin trading on the mainland, in April 2010.
stock index futures fell while the safe-haven yen rose on Monday as a possible U.
Summary: Tokyo/Sydney: Asian shares and US stock index futures fell while the safe-haven yen rose on .
Stock index futures rose overnight and the market surged at the open Thursday.
Abu Dhabi: The UAE stock markets rallied on Monday tracking the US stock index futures which indicated the Standard & Poor's 500 Index will gain for a third day, due to a general improvement in the situation in Egypt and in anticipation of robust fiscal second quarter earnings of local bluechip companies.