Written by:
Image
Paul Tracy

Paul has been a respected figure in the financial markets for more than two decades.

Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 2 million monthly readers. While there, Paul authored and edited thousands of financial research briefs, was published on Nasdaq. com, Yahoo Finance, and dozens of other prominent media outlets, and appeared as a guest expert at prominent radio shows and i...

View all posts
Updated August 5, 2020

What is an Assignable Contract?

An assignable contract allows a contract holder to assign his or her rights and obligations under the contract to a third party. The most common assignable contracts are futures contracts.

How Does an Assignable Contract Work?

Let's assume you own a futures contract to buy corn at a certain price in the future, and the value of the contract has increased by $10,000 since you bought it. Because futures contracts are often assignable, you can sell the contract to a third party today in return for cash, and the third party then assumes all the rights, responsibilities, and financial outcome of the contract from that point forward.

Not all futures contracts are assignable, especially those traded on exchanges.

Why Does an Assignable Contract Matter?

Assignable contracts provide a way for contract holders to lock in profits or cut losses without having to wait for the expiration date. If you are interested in buying or selling a contract, make sure to carefully check its terms and conditions to see if it is assignable or not.

Ask an Expert about Assignable Contract
At InvestingAnswers, all of our content is verified for accuracy by Paul Tracy and our team of certified financial experts. We pride ourselves on quality, research, and transparency, and we value your feedback. Below you'll find answers to some of the most common reader questions about Assignable Contract.
Be the first to ask a question

If you have a question about Assignable Contract, then please ask Paul.

Ask a question

Read this next

Don't Know a Financial Term?
Search our library of 4,000+ terms
 - profile
Ask an Expert about Assignable Contract

By submitting this form you agree with our Privacy Policy

Share
close