Future Contract
Future contract is the standardized legal agreement between buyer and seller to buy and sell the specified quantity of financial or physical assets at pre-set price in particular future date. In option, the option holder has freedom to buy (not buy) or sell (not sell) whereas the option writer has obligation to buy or sell. But in future contract, both party are legally binded to enter in to the transaction in specified future date. Seller must have to sell and buyer must have to buy in future contract. The pre-set price in future contract is called future price. It is traded in the future derivative market. In future contract, the loss of one party will be the gain of another party. So it is called the zero-sum game.
If the market price of an asset is higher than the stated price at the final date the buyer will make profit. And if the market price is below the stated price the seller will make profit. Let's see the example to be more clear.
A enters in to an future contract with B to buy 200 kg apple at $10 after 6 months from today. If market price stands at $9, $10 or $11, let's see who will gain.
Forward Contract
Forward contract is just like a future contract in which seller and buyer enter into an contract to sell and buy specified quantity of physical or financial assets at pre-set price in particular date but not standardized in nature.