A futures contract hedges against the risks associated with the volatility of spot price.

Name: A futures contract hedges against the risks associated with the volatility of spot price.
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Futures contracts are often used as a risk management tool to protect against the uncertainty of future price fluctuations. By locking in a specific price through a futures contract, the buyer and seller of the contract can protect themselves against potential losses due to price volatility in the spot market.

A Futures Contract Hedges Against the Risks Associated with the Volatility