Futures are derivative contracts that allow investors to utilize higher leverage, hedge their portfolio, and benefit from short-selling and downward movements in the market.
Investors can trade futures contracts on a variety of different asset classes commodities and financial instruments to try to earn profits from price fluctuations in the market. Commodity futures allow traders to speculate on the future prices of commodities, while financial futures let traders speculate on the future prices of financial assets like stocks, bonds and foreign currencies.
Learn MoreEquity Futures are a great option for hedging and managing risk, and they provide a number of advantages over stocks and other investment vehicles.
Your initial payment is only a fraction of the contract value, enabling you to control a large value with a small amount of capital. This leverage can result in higher profits and greater capital efficiency.
With initial margins as low as 4% of the traded contract, you can get started with a smaller upfront investment. Fees for futures trading are also lower than fees for trading equities.
You can profit from an asset that is declining in price by selling in advance and buying back later. Likewise, you can profit from an increasing price by buying now and selling later.
Protect yourself against the risk of losses due to unfavorable price movements in the market. By locking in a guaranteed price for buying or selling in the future, you remove uncertainty and reduce the likelihood of losses.
Because all futures transactions run through a regulated exchange, there is no risk of counterparty default. Each contract contains a specific quantity and expiration date, eliminating future price uncertainty.
Futures are highly transparent and liquid, which means you can more flexibly enter and exit the market at a reasonable price, no matter which asset class you are trading.
With our Equity Futures products, DFM offers you oil product and stock futures trading in one place.
Get the facts about trading Equity Futures before you start.