The cash market is a buying strategy in which the buyer makes an immediate payment that is equal to the current market price for commodities and other types of securities. Upon the receipt of the payment, the seller relinquishes all claims to the property and bestows ownership upon the buyer. In a sense, any type of retail transaction such as the purchase of groceries could be considered a cash market, as the goods are received by the buyer upon rendering a cash payment for the products.

One of the characteristics that sets the cash market apart from a futures market is this immediate satisfaction and transfer of ownership. Futures markets involve a longer period for the transaction to be considered complete. With a cash market, the investor immediately assumes ownership and is free to do with the commodity or security as he or she wishes. While both approaches are capable of helping an investor realize a return on an investment, the cash market approach may offer a level of speed and excitement that will attract investors who prefer to be constantly on the move with the investment portfolio.

One of the common designations for a cash market is "spot market." Spot markets get their name from the fact that business deals are initiated and completed on the spot, rather than requiring an extended period of time to resolve. Cash markets tend to be somewhat fast paced, since the turnaround time on a transaction is so short. Many investors may purchase a commodity on the cash market this morning, see a rise in the value by this afternoon, and sell before closing and make a significant profit.

Many physical commodities are bought and sold in this type of market. Metals are one example of a commodity that is often sold in a cash market. Grains like corn or wheat are also commodities traded in this type of market. Even meats such as pork bellies are often sold in a cash market. In addition, some securities as well as some underlying equities and bonds may also be sold in a cash market environment