Cash Market

Last reviewed: September 2, 2026

A cash market is a market where an asset is bought and sold for current or near-term delivery. It is often called the spot market, especially when contrasted with futures or forward markets.

Reviewed September 2026

Simple example

If a company buys a commodity at today’s market price for near-term delivery, that transaction takes place in the cash or spot market. A futures contract on the same commodity sets terms for a specified future contract month.

Cash market vs. futures market

Cash-market prices reflect transactions for immediate or near-term delivery. Futures prices apply to standardized contracts for future delivery or settlement. The two prices are related but can differ because of financing, storage, income, expectations and other market factors.

Where the term is used

Cash markets exist for securities, currencies and physical commodities. Settlement conventions vary by market, so “cash” does not always mean literal same-day delivery.

Why the relationship matters

Traders and hedgers compare cash and futures prices to understand basis, carrying costs and market conditions. As a futures contract approaches expiration, its price and the relevant cash-market price generally become more closely connected.

Related concepts

• Spot market
• Futures
• Basis