Determining the price of the future contract and the future contract

Financial markets have been created to make the economy flourish and grow with the optimal use of financial resources. Various financial instruments have been designed and introduced to diversify the economy and financial markets, and one of these instruments is derivative instruments, which include four types: forward contracts, futures contracts, options, and swaps, each of which has a specific purpose and application. In recent years, the market of these instruments has become very important in the world of finance and investment, and they have reached a level of financial innovation that it is necessary for financial experts to be aware of how these markets work, as well as the mechanism of determining the price of these instruments. Things like price discovery, market stability and market efficiency are among the important financial issues, and besides that, there are factors affecting the price of future contracts, which are very useful for traders and market participants because they can predict the cash price by using the future price. Therefore, in this article, it has been tried to explain the different methods of determining the price of the forwards contract and the futures contract.