Spot price

From Academic Kids

The spot price of a commodity or a security or a currency is the price that is quoted for settlement (payment and delivery) of the transaction immediately. This is contrasted with a forward price on the futures market, which is the price at which a commodity may be transacted (bought/sold) now but with settlement to occur at a given future date.

The difference between the spot and forward prices of a perishable commodity may be an indication of how the markets expect the price of that commodity to change during the period. The difference in spot and forward price in a security (or a commodity such as gold) is usually just the finance charges and the earnings due to the holder of the security - e.g. on a share the difference in price between the spot and forward price is usually accounted for almost entirely by any dividends payable in the period minus the interest payable on the consideration.

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