More About Futures
A Futures contract is a financial instrument that helps traders manage price risk. By buying or selling Futures contracts (agreements that establish a price level now for items to be delivered later), traders can establish some level of insurance against adverse price changes.How does it work?
Futures are standardised by quality, quantity, delivery time and location for each contract. The critical variable is price, which is derived dynamically through the global marketplace. Futures are different from generic forward contracts, among other things, because they have a margin requirement that must be settled daily.
Who trades futures?
Today, speculators contribute a major source of trading volume in the Futures markets. Trade at the best price available in the market amongst the professionals with access to the most dynamic markets in the world. E*TRADE classifies FX (Futures) traders as Intermediate Customers as defined by the FSA
Which Futures are traded online?
- Interest Rate Futures
Interest Rate Futures are probably the most popular and practical Futures contracts. They offer informed speculators a dynamic arena for interest rate movements across a spectrum anywhere from the Japanese Yen to the Euro. - Equity Index Futures
Equity Index Futures offer both up and down movement of the stock market, without being tied to individual trading decisions on specific securities. Individuals and institutions are able to protect their portfolios and enhance income by purchasing Futures contracts on the indices. E-minis are traded electronically as a smaller version of the stock index and are some of the most popular Equity Index Future contracts today. - Currency Futures
Currency Futures are traded online by traders and investors with particular interest in the movement of currencies over time. Among the most popular currency Futures are USD, EUR, GBP, JPY, CHF, CAD and AUD. - Commodity Futures
E*TRADE offers direct online trading in popular commodity Futures including gold, silver, crude oil and natural gas. All four commodity Futures are quoted as Minis on NYMEX and CBOT.
