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Spot

The spot price is the current market price at which an asset, such as a commodity, currency, or security, can be bought or sold for immediate delivery. Spot prices are in contrast to future prices, which refer to agreements to buy or sell an asset at a set price for delivery at a later date. Spot transactions are common in commodity markets, where goods like oil or gold are traded for immediate delivery.

Example

The spot price of gold is $1,800 per ounce, meaning it can be bought or sold at that price for immediate delivery in the market.

Key points

• The current price of an asset for immediate delivery.

• Common in commodities and currency markets.

• Differs from futures prices, which are for delivery at a later date.

Quick Answers to Curious Questions

Supply and demand, market conditions, and geopolitical events all affect the spot price of commodities.

Spot prices are for immediate transactions, while futures prices refer to contracts for delivery at a future date.

They reflect the real-time value of assets and guide immediate buying and selling decisions.

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