Transactions on the commodity exchanges fall into Forex Monarch Reviewtwo broad categories: cash contracts and futures contracts. Accordingly, the commodity exchange may be a cash market or a futures market, or may combine both. The cash contracts for the purchase of commodities are those which call for payment of the full contract price, in cash, on delivery. Such contracts are also referred to as physical contracts, in the sense that they deal in actual or physical products. The cash or physical contracts may be sub-divided into two sub-classes: spot contracts and forward contracts.

Spot transactions are those cash contracts which involve the payment by the buyer and the delivery of the specified grade of goods by the seller immediately, or within a short time. These contracts relate to the purchase or sale of commodities on the spot. The essence of such contracts is the ready delivery and acceptance of the delivery of the goods sold. Forward dealings are those cash contracts made in the cash or physical market, which call for the delivery of goods and payment of the price after a specified period, on a fixed date.

As against cash contracts, which require the payment or cash against the physical delivery of goods immediately on the spot or after a specified period, a futures contract is a special type of agreement made strictly under the rules of a commodity exchange, which may or may not call for the actual delivery of goods and payment of price in cash on a future trade.https://americansreviews.com/forex-monarch-review/