Futures options trading brokers
Contract specifications can sometimes be changed by the exchange, and is usually done to keep the contract viable. To stand in a trading pit, a trader needs to buy an exchange membership, pay annual dues, and register with various regulatory agencies.
Naturally, few people would trade futures if it required that they stand in the trading pit. To solve this problem, in steps the futures broker. A futures broker acts as a communication link between the trading pit and the trader, taking orders from the customer, and executing them in the futures pit.
By law, futures brokers do not have the authority to take customer funds and hold them in deposit. Only an FCM can do this. For this reason, a futures broker needs to team up with an FCM in order to provide order execution services to its customers.
In a literal sense, it stands as a buyer to every seller and a seller to every buyer. That means that a futures trader does not have to worry about any default of a futures counterparty.
What happens if that person cannot pay? Does A sacrifice her profit? The answer is "NO". The clearing corporation guarantees the transaction. The clearing corporation's elimination of such counterparty credit risk provides a great benefit to the futures and options markets. One may wonder how the clearing corporation does this. The answer lies in the margin deposit that every other futures trader must make before trading any contract.
This margin is available to the clearing corporation and, together with other reserve cash and various protection funds, are used to cover any customer default. A clearing corporation is composed of clearing members, most of which are large FCM's. W e Offer Low Commission Rates. View our rates page. Accounts requiring broker assistance will be charged a higher commission rate.
C all Us with any Questions. We are here to help! Toll Free International Whether you are an experienced trader looking for great rates, or you are new to futures trading and looking for educational material - you came to the right place. We offer almost everything and anything a commodity trader could possibly want: Daily Commodity Trading Research and News - Updated daily and weekly with current market analysis and reports.
Advanced Research - Get access to more advanced and in-depth futures research. Commodity Trading Advisors - View the commodity trading advisors and see if managed futures could be for you!
The term managed futures describes an industry made up of professional money managers known as commodity trading advisors CTAs. Investment management professionals have been using managed futures for more than 20 years. With practically a zero correlation with stocks, one of the most attractive features of managed futures is its ability to add profound diversification to an overall investment portfolio. Modern Portfolio Theory - Dynamic Diversification for Today's Investor This brochure has been described as a "one-book library" on portfolio diversification.
An important lesson for stock investors; and much more. After reading this brochure, you'll probably be better informed about professionally managed futures.
Futures Trading System - Emotional decision making is often a trader's worst enemy. System trading removes this emotional element, in fact many of the top-performing Commodity Trading Advisors CTAs rigidly follow proprietary trading systems. We are currently recommending the following systems: About Futures Trading - Basics of futures trading is explained. Discount Futures Broker - Lowest commission rates offered for high volume traders.
Education Center - Information and help on futures and commodity trading. Research and Informative Articles - Gain access to the client research section.
Updated daily - market recommendations, special reports, and much more. Glossary of Commodity Trading Terms - Industry related terms explained. A great resource for beginning traders. Trading futures and options involves substantial risk of loss and is not suitable for all investors.