Stock Trading Strategies > Investing In Futures

Investing In Futures: How To Trade Futures

Understanding Opportunities and Risks in Futures Trading

*This information is provided by the National Futures Association.

Futures markets have been described as continuous auction markets and as clearing houses for the latest information about supply and demand. They are the meeting places of buyers and sellers of an ever-expanding list of commodities that today includes agricultural products, metals, petroleum, financial instruments, foreign currencies and stock indexes. Trading has also been initiated in options on futures contracts, enabling option buyers to participate in futures markets with known risks.

Introduction
Futures Markets: What, Why & Who
The Market Participants
What is a Futures Contract?
The Process of Price Discovery
After the Closing Bell
The Arithmetic of Futures
Margins
Basic Trading Strategies
Buying (Going Long) to Profit from an Expected Price Increase Selling
(Going Short) to Profit from an Expected Price Decrease Spreads
Participating in Futures Trading
Deciding How to Participate
Regulation of Futures Trading
Establishing an Account
What to Look for in a Futures Contract
The Contract Unit

Free Video: How To Spot Winning Futures

How Prices are Quoted
Minimum Price Changes
Daily Price Limits
Position Limits
Understanding (and Managing) the Risks of Futures Trading
Choosing a Futures Contract
Liquidity
Timing
Stop Orders
Spreads
Options on Futures Contracts
Buying Call Options
Buying Put Options
How Option Premiums are Determined
Selling Options
In Closing