This is done by taking a position in a futures contract that offsets potential adverse price movements. Speculators, on the other hand, bet on the direction an asset's price will move with the intention of making substantial profits. Both play a role in the futures market. A futures contract requires two counterparties. On the one hand there is the hedger whose goal is to transfer risk and on the other hand there is the speculator who is willing to take on the hedger's risk in the hope of making a profit. Without both parties the futures market would not exist. Furthermore, the supply and demand relationship between the two allows for the liquidity of futures and contributes to their functionality