Futures Trade Sample

Futures Markets has been around for hundreds of years; long before the existence of electronically traded markets like the NASDAQ and CME Globex. Ironically the fundamentals of trading have not changed, what has changed are the vehicles in which we use to trade.

  

The Advantages of Trading Futures

Trading futures contracts have several advantages over other investments:

1. Futures are highly leveraged investments. To ‘own’ a futures contract an investor only has to put up a small fraction of the value of the contract (usually around 10%) as ‘margin’.
2. An investor can make money more quickly on a futures trade. Firstly, because he is trading with around ten-times as much of the commodity secured with his margin, and secondly, because futures markets tend to move more quickly than cash markets. (Similarly, an investor can lose money more quickly if his judgement is incorrect, although losses can be minimised with Stop-Loss Orders, placing stop-loss orders to maximum effect.)
3. Futures are harder to trade on inside information. After all, who can have the inside scoop on the weather or the Chairman of the Federal Reserve's next proclamation on the money supply? The open outcry method of trading - as opposed to a specialist system - insures a very public, fair and efficient market.
4. Most commodity markets are very broad and liquid. Transactions can be completed quickly, lowering the risk of adverse market moves between the time of the decision to trade and the trade's execution.
5. Commission charges are small compared to other investments and are paid after the position has  ended.

Off-Exchange Futures offered at ICMBrokers
ICMBrokers focuses on giving access only to those off-exchange futures instruments that are electronically traded, highly liquid, and most desired by online traders.  By limiting our product offering, we are able to guarantee best market execution for our customers.

Particulars of the Offered Instruments 

Class	Description	Symbol	Contract Size	Tick value
Energy Derivatives	Light Sweet Crude Oil	CL	1,000 Barrels	$10
Index Derivatives	Dow Jones	DJ	$10 x Index Value	$10
	Mini Dow Jones	YM	$5 x Index Value	$5
	Mini NASDAQ	NQ	$20 x Index Value	$5
	Mini S&P	ES	$50 x Index Value	$12.50
Commodity Derivatives	Sugar	SB	112,000 lbs.	$11.2
Financial Derivatives	Euro	EC	EUR 125,000	$12.50
	British Pound	BP	GBP 62,500	$6.25
	Swiss Franc	SF	CHF 125,000	$12.50
	Japanese Yen	JY	JPY 12,500,000	$12.50
	Australian Dollar	AD	AUD 100,000	$10
	Canadian Dollar	CD	CAD 100,000	$10

Margin Requirements
In order to buy or sell 1 contract (lot) of a futures instrument with ICMBrokers, the investor must have a minimum of $1,000 in the account ($2,500 for off-exchange financial futures).  Though an initial margin of $1,000 is required, ICMBrokers has no maintenance margin on standard accounts.  In order to guarantee that clients’ accounts do not extend into negative equity, the trading platform automatically closes all positions at the 5% Equity/Margin ratio.

Profit and Loss Calculation Examples
• Sell 5 CL at 43.50  |  Buy 5 CL at 42.60

   43.50 (open price)   x 5 (lots traded) x 1,000 barrels (contract size) = 217,500
   42.60 (close price)   x 5 (lots traded) x 1,000 barrels (contract size) = 213,000
                                                                                                            $ 4,500 (Profit)
• Buy 3 DJ at 8340   |   Sell 3 DJ at 8520

   8340 (open price) x 3 (lots traded) x 10 (contract size) = 250,200
   8520 (close price) x 3 (lots traded) x 10 (contract size) = 255,600
                                                                                             $ 5,400 (Profit)

To know more about our ICMBrokers Futures Instruments please click the link: ICMBrokers Off-Exchange Futures