Futures · Pro
Physical delivery
What does Physical delivery mean?
Physical delivery settles a futures obligation through delivery of the specified underlying asset or deliverable instrument rather than only a cash difference. Procedures depend on the contract.
Example
A deliverable commodity contract enters its delivery process when eligible positions remain open.
Illustrative example; not a provider’s quoted offer.Why it matters for prop traders
Many retail trading services require positions to close earlier. An online trading interface does not change the underlying settlement method.
Sources and further reading
The following primary sources support the terminology. Provider rules describe their own products and may change.