Easily buy futures at incredibly low fees

Futures are standardised derivative contracts between two parties to buy or sell an underlying asset at a predetermined price on a specific future date. The underlying asset can be a commodity, index, equity or fixed income instrument.

When trading futures, you do not own the underlying asset and you do not pay the full contract value upfront. Instead, you deposit an initial margin to enter the position. The value of a futures contract is derived from the price of the underlying asset, and gains or losses depend on how that price moves over time. Trading futures involves risk, and you may lose more than your initial investment. Carefully consider your risk appetite before investing.

To trade futures, you are required to deposit initial margin, which is a percentage of the total contract value. This margin acts as collateral for the obligation you enter into when trading a futures contract.

Because only a fraction of the contract value is required upfront, futures are highly leveraged instruments. This leverage means that relatively small price movements in the underlying asset can lead to significant gains or losses.

Futures positions are marked-to-market on a daily basis. This means that gains and losses are settled daily through a mechanism known as variation margin. Profits are credited to your account, while losses are debited. As a result, your available cash balance can fluctuate each trading day.

If market movements reduce your margin below the required level, you may receive a margin call to deposit additional funds.

Futures can be linked to a wide range of underlying assets, including:

• Commodities, such as oil or agricultural products
• Stock indices
• Equities
• Fixed income instruments

The available futures contracts depend on the exchange and the specific product.

Both futures and options are derivative products, but they differ in terms of obligation.

• Futures contracts involve a binding obligation for both parties to buy or sell the underlying asset at the agreed price and date.
• Options give the buyer the right, but not the obligation, to buy or sell the underlying asset.

Because futures involve mandatory execution and daily settlement, they are generally considered to carry higher risk than options.

Investing in futures involves high risk and is generally more suitable for experienced investors. Due to leverage and contractual obligations, losses can exceed your initial investment and, in some cases, may be unlimited.

Key risks to consider include:

• Leverage risk: Futures are highly leveraged, meaning small price movements can lead to large gains or losses. Losses can occur quickly.
• Margin risk: If the value of your position moves against you, you may be required to deposit additional margin at short notice.
• Market risk: Price movements in the underlying asset can negatively affect the value of a futures position.
• Obligation risk: Futures contracts create binding obligations that must be fulfilled at settlement.
• Complexity risk: Futures require active monitoring and a good understanding of how margin, settlement and leverage work.

Before investing in futures, it is important to fully understand how these products work and the risks involved. Consider your knowledge and experience when making investment decisions. Carefully consider your risk appetite before investing.