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Name One Common Type of Derivative Contract That Exclusively Uses Cash Settlement

Index Futures are typically settled exclusively in cash because the underlying is a non-deliverable index.
Greeks.Live24.11.25

Name One Common Type of Derivative Contract That Exclusively Uses Cash Settlement.

A common type of derivative contract that exclusively uses cash settlement is an Index Future. Since an index, such as the S&P 500 or a Cryptocurrency Composite Index, is not a physical asset that can be delivered, settlement must be in cash.

The final value is based on the index level at expiration, and the difference is paid out.

How Does the Settlement Process Differ between Cash-Settled and Physically-Settled Futures?
What Is the Primary Difference between Cash-Settled and Physically-Settled Futures?
Name a Major Crypto Options Exchange That Offers Both Settlement Types
How Does the Margin Requirement Differ for Physically-Settled versus Cash-Settled Futures?

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