Difference Between The Forward and Futures Contract

Forward Contracts	Futures Contracts
Private contract between the two parties bilateral contracts	Traded on organized exchanges
Not standardized (customized)	Standardized contract
Normally one specified delivery date	Range of delivery dates
Settle at the end of maturity. No cash exchange prior to delivery date.	Daily settled. Profit/loss are paid in cash.
More than 90% percent of forward contract are settled by actual delivery of assets.	Not more than 5 percent of future contract are settled by delivery.
Delivery or final cash settlement usually takes place	Contract normally closed out prior to the delivery.
Exists if there is no agreement on margin payment	Does not exist, as margin is obligatory