| Key Terms |
Definition |
| Contract 1 |
A futures contract specifying the earliest delivery date. Natural gas contracts expire three business
days prior to the first calendar day of the delivery month. Thus, the delivery month for Contract 1
is the calendar month following the trade date.
|
| Contract 2-4 |
Represent the successive delivery months following Contract 1.
|
| Futures Price |
The price quoted for delivering a specified quantity of a commodity at a specified time and
place in the future.
|
| Natural Gas |
A gaseous mixture of hydrocarbon compounds,
the primary one being methane.
|
| Spot Price |
The price for a one-time open market transaction for immediate delivery of a specific
quantity of product at a specific location where the commodity is purchased "on the spot"
at current market rates.
|
Definitions