Discount Futures Brokerage is formatted to provide a more cost effective way of trading futures for experienced traders who are comfortable placing trades over the internet , using their personal computer..
Discount Futures Brokers typically offer lower service fees and take a more minimal role in daily trading decisions. What you are essentially using a broker since then, is to place orders and for representation on the exchange floor. It is true that futures trading, or any trading market for that matter, could not operate without market participants and market professionals representing those participants. With commodities markets being so risky, regardless of cost it is clear that qualified brokers are vital to the success of participants of various markets.
What’s The Difference?
The biggest difference with discount brokers is the client’s ability to be more self-directed with their trading profile. The risk associated with futures trading disclaims that there is no guarantee of profit no matter who manages your money. No matter the level of involvement, brokers still represent the interests of every client and are likewise as valuable. The need for Futures Trading Brokers will never become obsolete, so the emphasis on discount brokerage need be on discounted commissions and fees, not discounted service.
Below is a list of lesser or excluded fees associated with a discount futures brokerage:
- Account Maintenance Fees
- Platform Fees
- DataFeed Fees (Online/E-Trading)
- Low Margin Investments
- Broker Support Fees
Another difference with discount brokerage is the type of platform often used for this type of futures brokerage service; online. Online Futures Trading is in some cases synonymous with a discount futures brokerage. The reason this is, is due to lower costs associated with online platforms that allow you to do most of the monitoring of real time market data. A wide selection of online futures companies provide the software you can download to use to trade and build a profile. When one places orders online, he doesn’t need to call his broker and place orders via phone. That saves the time of the broker and allow for lower, discounted fees.
