Future Contract is defined as a standardized, transferable, exchange-traded contract that requires delivery of a commodity, bond, currency, or stock index, at a specified price, on a specified future date. With future contract, the risk to both the seller and buyer is unlimited since future trading is a zero-sum game. Future contracts are forward contract that represent a pledge to make transaction at a future date. In the contract, the exchange of assets occurs on the date specified. In order to insure payment, futures have a margin requirement that must be settled daily. Finally, future contracts can be closed by making an offsetting trade, taking delivery of goods, or arranging for an exchange of goods. Currency futures contracts are available for many currencies. The Chicago Mercantile Exchange (CME) is continually adding new contracts with those meet the minimum volume requirements, and drops those do not meet the requirement. Compare with forward contracts, future contracts are standardized contracts that trade on organized futures markets for specific delivery dates only. The most actively traded currency futures contracts are for March, June, September, and December delivery. Contract expired two business days before the third Wednesday of the delivery month. Contract size and maturities are standardized to all participants. On the other hand, forward contract are private deals between two individuals who sign a contract they can agree on. The CME contracts trade only round lots of certain minimum amount with a limited range of maturities available. The trading volume in available contracts is higher than forward contract. In future contract, profit and losses are paid over every day at the end if trading, which is called marking to market. Daily settlement reduced the default risk of future contracts relative to forward contract. Future contracts can also be closed out with an offsetting trade.   Source: http://www.investorwords.com/2136/futures_contract.html