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if the market goes up sell spot buy in future market if market goes down buy spot sell in future market

Q: What are the trading mechanism of forward market?

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if the market goes up sell spot buy in future market if market goes down buy spot sell in future market

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the spot market

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Spot market is also known as "cash market" where the commodities are sell on the current price or the spot rate and deliver immediately, where as in case of forward market, market dealing with commodities for future delivery at prices agreed upon today (date of making the contract).

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The spot market or cash market is a public financial market in which financial instruments or commodities are traded for immediate delivery. It contrasts with a futures market, in which delivery is due at a later date. In spot market, settlement happens in t+2 working days, i.e., delivery of cash and commodity must be done after two working days of the trade date. A spot market can be:

an organized market;
an exchange; or
over-the-counter (OTC)

Spot markets can operate wherever the infrastructure exists to conduct the transaction

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When you go out on the spot market and pay market value instead of going through your normal supply chain where you might have contracts or discounts set up. To make a spot buy usually is more expensive but it is to fill and immediate need.

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