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What are the Alternatives for Settlement of a Futures Contract?

As a rule, futures can be settled physically or in cash.


Futures with physical delivery require the buyer of the future to actually accept and pay for the delivered underlying instrument (for example bonds) on the maturity date.

Physical delivery:
Regardless of wether future contracts are settled physically or incash; offsetting of profit and loss is conducted daily, in cash!

Futures that are settled in cash replace a physical delivery in favor of a cash settlement. The reason for this is that a delivery for such futures is not possible, or only possible with some difficulty (for example equity index future). The following futures on Eurex Exchange are physically settled:

  • Fixed Income-Futures
  • Futures on Exchange Traded Funds
  • Futures on Exchange Traded Commodities

The fixed income futures on Eurex Exchange (futures on bond issues such as Euro Bund Future) have a fictitious underlying and therefore cannot be physically delivered, but a pallet of similar shares will be delivered. You may find further information in the next chapter. CO2 futures have a distinctive feature. Eurex Exchange market participants can trade these via cooperation with the European Energy Exchange. Fulfillment for these futures occurs via transfer of so-called EU emission allowances within the internal accounts of exchange participants.

The following futures on Eurex Exchange are cash settled:

  • Equity Futures*
  • Equity Index Futures
  • Money Market Futures
  • Dividend Futures
  • Volatility Index Futures
  • Euro Inflation Futures
  • Commodity Futures (incl. Power Futures)

*OTC traded equity futures that are entered for settlement into the system can be EurexOTC Flex products with physical delivery if the contractual partners have agreed to this term.

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