In a cash market buyers pay the market price for securities, currency, or commodities "on the spot," just as you would pay cash for groceries or other consumer products.
Cash markets are also called spot markets. A cash market is the opposite of a futures market, where commodities or financial products are scheduled for delivery and payment at a set price at a specified time in the future.
In a cash market, ownership is transferred promptly, and payment is made upon delivery.
- Browse Related Terms: Cash market, Contango, Counterparty, Counterparty risk, Foreign exchange (FOREX), Forward contract, futures, options, Past Due Item, Spot market, Spot price