delivery of 1,000 tons of coffee, you can simply buy and sell the contracts.) The futures market uses a form of margining based on the principle of mark to market. If a futures contract was worth $1,000 and the contract is worth only $500 by the end of the day, the $500 loss is taken out of your account (in cash). In addition to mark-to-market rules, futures trades are also cash-secured, meaning that your account must be paid off or settled in cash by the end of the day. The mark-to-market rule has ruined many unsuspecting
