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FUTURES MARKET

Definition of the FUTURES Market

Derivative market that can be traded through Commodities, Indices, Bonds, and Currencies.

Traded in contracts (The E-mini is the most common index future contract). Traded on an exchange and regulated similarly to other exchange-traded markets (i.e. CME, CBOT, NYMEX, Eurex, and more).

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Benefits of Trading FUTURES

Gives the equities trader a distinct edge by understanding the leading market (70% of a stock’s movement is directly correlated to the Futures market).

Provide traders the ability to be diversified among many different markets through one asset class (Commodities, Indices, Bonds, and Currencies).

Provides great trading opportunities because of the volatility. Provides great leverage compared to the expense of trading equities.

Clears the same day so your money is available by the end of the day. Strong day trading opportunities.

Gives the trader/investor the ability to hedge longer term positions.

Typically does not gap because it’s a 24 hour market.

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How are FUTURES Traded?

Contracts (Margin Requirements will vary between brokerage houses; some start as low as $500 per contract intraday).

Traded in contracts with quarterly expirations (March, June, October, December).

Profits and Losses are measured in ticks and points:

4 ticks per point

For example:
E-mini S&P / 1 tick = $12.50 / 1 point = $50

Trades 23 hours and 45 minutes per day.

Closes at 3:15pm CST to 3:30pm CST to settle and then reopens at 3:30pm.

CST The overnight session is referred to as the “globex” and has lower volume.

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Ideal Account Size for FUTURES

Traders who are trading the Index Futures can open an account with as little as $2,500 at some brokerage houses.
An educated trader/investor should be aware of appropriate account size, position sizing, and risk management when trading or investing in any market.

Types of Accounts for FUTURES

Cash
IRA (Traded through a Custodial Firm)
Various Entity Structures (LLC, Corp, LP, etc.)

General Disclosure:

Trade With the Pros LLC (“TWP”) is a financial education provider for customers looking to build the skills and proficiency necessary for retail trading and investing in the financial markets. TWP is not a Broker-Dealer, an Investment Adviser, or any other type of business subject to regulation by the SEC, CFTC, state securities regulators or any “self-regulatory organization” (such as FINRA).

The programs and content that TWP distributes are for informational and educational purposes only. No one should consider the information disseminated by TWP to be personalized investment advice, a recommendation to buy, sell or hold any investment, an offer (or a solicitation of an offer) to buy or sell any investment, or the provision of any other kind of advice that would require TWP to register as a broker-dealer, investment adviser or similar entity. No one associated with TWP is authorized to make any representation to the contrary.

TWP provides information that its customers may use to make their own investment decisions. However, any customer will be responsible for considering such information carefully and evaluating how it might relate to that viewer’s own decision to buy, sell or hold any investment. Such decisions must be based on that customer’s individual and independent evaluation of his or her financial circumstances, investment objectives, risk tolerance, liquidity needs, family commitments and other factors, not in reliance on any information obtained from TWP.

Statements by any person (whether identified as associated with TWP or any other entity) represent the opinions of that person only and do not necessarily reflect the opinions of TWP or any other person associated with TWP.

It is possible that any individual providing information or expressing an opinion on any TWP program may hold an investment position (or may be contemplating holding an investment position) that is inconsistent with the information provided or the opinion being expressed. This may reflect the financial or other circumstances of the individual or it may reflect some other consideration. Customers of TWP programs and consumers of its content should take this into account when evaluating the information provided or the opinion being expressed.

Although TWP strives to provide accurate and reliable information from sources that it believes to be reliable, TWP makes no guarantees as to the accuracy, completeness, timeliness, or correctness of any such information. TWP makes no guarantee or promise of any kind, express or implied, that anyone will profit from or avoid losses from using information disseminated through TWP.

All investments are subject to risk of loss, which you should consider in making any investment decisions. Customers of TWP programs should consult with their financial advisors, attorneys, accountants or other qualified professionals prior to making any investment decision.

The risk of loss in trading equities, options, forex and/or futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage that is often obtainable in options and futures trading may benefit you as well as conversely lead to large losses beyond your initial investment. Past results are not indicative of future results. No representation is being made that any account will or is likely to achieve profits similar to those shown.

Risk Disclosure:

All investments are subject to risk of loss, which you should consider in making any investment decisions. Viewers of Trade With the Pros programs should consult with their financial advisors, attorneys, accountants or other qualified professionals prior to making any investment decision.

The risk of loss in trading equities, options, forex and/or futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage that is often obtainable in options trading may benefit you as well as conversely lead to large losses beyond your initial investment. Past results are not indicative of future results. No representation is being made that any account will or is likely to achieve profits similar to those shown.

Testimonial Disclosure:

The aforementioned testimonials are made by individual subscribers to Trade With the Pros services. The experience of these individuals may not be representative of the experience of other subscribers, like yourself. In addition, the aforementioned testimonials do not guarantee future success by using such services. No consideration was paid to the individuals that submitted these testimonials.