{"id":13443,"date":"2017-10-31T05:40:41","date_gmt":"2017-10-31T13:40:41","guid":{"rendered":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/?p=13443"},"modified":"2017-10-31T06:28:10","modified_gmt":"2017-10-31T14:28:10","slug":"how-to-trade-in-trade-futures","status":"publish","type":"post","link":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/how-to-trade-in-trade-futures\/","title":{"rendered":"How to Trade in Futures"},"content":{"rendered":"<p>Long-term success in futures trading usually doesn\u2019t begin overnight. You need to develop a proven trading technique that \u2013 more often as not \u2013 works. For new traders, <a href=\"https:\/\/www.forbes.com\/2010\/05\/13\/how-to-trade-futures-personal-finance-futures.html\" target=\"_blank\" rel=\"noopener\"><em>Forbes<\/em><\/a>\u00a0magazine is a solid source for financial information. In one article, it flatly states, \u201cYou would be better off just giving your money to experienced traders . . . it would save on your emotional wear and tear.\u201d<\/p>\n<ul>\n<li><strong>First Things First: Research<\/strong><\/li>\n<\/ul>\n<p style=\"text-align: center;\"><em>The only thing more expensive than education is ignorance.<\/em><br \/>\n-Benjamin Franklin<\/p>\n<ul>\n<li>Time is on your side. As a beginner in futures trading, it\u2019s important to <a href=\"https:\/\/www.cannontrading.com\/tools\/futures-commodities-trading-resources\">research risks and leverage<\/a>. You will learn the ins and outs of this exciting marketplace when you work with a trustworthy, experienced online futures trading broker.<\/li>\n<li>Part of your research into futures trading is to <a href=\"http:\/\/www.investopedia.com\/university\/beginners-guide-to-trading-futures\/futures-trading-considerations.asp\" target=\"_blank\" rel=\"noopener\">choose your online futures trading brokerage<\/a>.\u00a0The type of guidance you need will change as you learn more about the futures commodities trading market. Hopefully, your brokerage company will mentor your futures trading evolution; as a beginner, you may need a <a href=\"https:\/\/www.cannontrading.com\/services\/broker-assisted-traders\">full-service broker<\/a>. Later, you may opt for lower commissions and fees as you become more knowledgeable and adopt a do-it-yourself approach to online trading. Your considerations include:<\/li>\n<li>Brokerage\u2019s reputation for customer service<\/li>\n<li>Commission rates you can afford<\/li>\n<li>Margin requirements that you can handle<\/li>\n<li>Software that is user-friendly and meets your requirements<\/li>\n<li>Types of futures in which you are interested<\/li>\n<\/ul>\n<p><!--more-->Historically, <a href=\"https:\/\/www.cannontrading.com\/\">futures trading<\/a> utilizes one of the <a href=\"http:\/\/www.investopedia.com\/university\/beginners-guide-to-trading-futures\/\" rel=\"nofollow noopener\" target=\"_blank\">oldest types of derivatives contracts<\/a>.\u00a0They were originally developed for farmers, who could hedge against changes in their crops\u2019 prices between the time the crops were planted and the time crops were harvested and brought to market.<\/p>\n<h2>Use What You Know<\/h2>\n<p>Futures Trading and stocks trading have many similarities as well as differences. With stocks, you own a certain stock and usually there is no margin involved or 50% max margin. You can also trade ETF\u2019s through a stock account. Futures and <a href=\"https:\/\/www.cannontrading.com\/tools\/how-to-invest-in-commodities\">commodities trading<\/a> may have the same technical analysis principles as well as many similarities with the options trading but with futures there is a built in leverage that allows you to control much more money. Also, <a href=\"http:\/\/www.investopedia.com\/university\/beginners-guide-to-trading-futures\/basic-structure-futures-market.asp\" target=\"_blank\" rel=\"noopener\">commodities futures contracts<\/a>\u00a0have a set delivery date, at which time the contract expires. You can trade as many types of futures contracts as you want, but it\u2019s best to stick with what you know or would like to learn more about. For example, if you worked for an oil company for several years, you might want to focus on energy commodities which include oil, gas, and coal, because you understand the trends in that market. Your trading brokerage should be able to show you recent trends and a <a href=\"https:\/\/www.cannontrading.com\/community\/newsletter\/Few-Ways-to-Enter-Trade-OPEC-Chatter-Sends-Crude-Higher#three\">current market view<\/a>\u00a0every day.<\/p>\n<h2>Categories of futures markets include:<\/h2>\n<ul>\n<li>Agriculture (dairy, forest, grains, livestock)<\/li>\n<li>Currencies and Forex [foreign exchange] (GBP\/$, Euro\/$, Euro\/Yen, Yen\/$)<\/li>\n<li>Energy (coal, crude oil, heating oil, natural gas)<\/li>\n<li>Equity\/stock indexes (E-mini S&amp;P 500, Nasdaq 100, Nikkei 225, S&amp;P 500)<\/li>\n<li>Interest Rates (Barclays Aggregate Index, treasuries, interest rate swaps, money markets)<\/li>\n<li>Metals (base metals [copper, lead, nickel, zinc], gold, platinum, silver<\/li>\n<\/ul>\n<h2>Types of trades\u00a0are:<\/h2>\n<ul>\n<li>Basis trade \u2013 a wager that the price differential between cash and futures will fluctuate<\/li>\n<li>Spread trade \u2013 a wager that the price difference between two different futures contracts will change.<\/li>\n<li>Hedging \u2013 a contract where you sell a futures contract to offset positions you hold in the cash market<\/li>\n<li>Other types of trading can be:<\/li>\n<li>Day trading<\/li>\n<li>Swing trading<\/li>\n<li>Options spreads<\/li>\n<li>Futures spreads<\/li>\n<li>Combination of futures with options<\/li>\n<li>Selling option premium<\/li>\n<li>ALGO\/ automated systematic trading<\/li>\n<li>More\u2026.<\/li>\n<\/ul>\n<p>Once you have selected the assets you want to trade, you need to make a deposit into your trading account for margin purposes in order to <a href=\"http:\/\/www.investopedia.com\/video\/play\/how-trade-futures-contracts\/\" target=\"_blank\" rel=\"noopener\">initiate your position as a futures buyer or a seller<\/a>.\u00a0Before placing the trade, your online futures broker will probably ask about your previous investment experience and your <a href=\"https:\/\/www.nerdwallet.com\/blog\/investing\/started-futures-trading\/\" target=\"_blank\" rel=\"noopener\">income\/net worth<\/a>. This helps your broker understand your financial background a bit better and helps in assessing your risk profile\/ tolerance.<\/p>\n<p>You must meet a <a href=\"https:\/\/www.cannontrading.com\/services\/futures-trading-margins\">maintenance margin<\/a>\u00a0to keep your account active. A maintenance margin is a minimum of <a href=\"http:\/\/www.investopedia.com\/terms\/m\/maintenancemargin.asp\" target=\"_blank\" rel=\"noopener\">10% of the total market value<\/a>\u00a0of your margin account.<\/p>\n<h2>Futures Trading: Is It a Good Idea?<\/h2>\n<p style=\"text-align: center;\"><em>Wealth is in ideas \u2013 not money.<\/em><br \/>\n-Robert Collier<\/p>\n<p>As a newcomer to futures trading, you should take advantage of <a href=\"https:\/\/www.cannontrading.com\/services\/futures-trading-services\">Cannon Trading broker-assisted services<\/a>, where <strong>you always make the final futures trading decision<\/strong>. Services include:<\/p>\n<ul>\n<li>24-hour order desk<\/li>\n<li>Fast\/accurate order execution<\/li>\n<li>Instant access to information regarding your account<\/li>\n<li>Live quotes, current charts, research information, and daily emails<\/li>\n<li>Personalized attention and superior customer service<\/li>\n<li>Trading strategies that consider your lifestyle and personality<\/li>\n<\/ul>\n<p>Call 310.859.9572, 800.454.9572, or <a href=\"https:\/\/www.cannontrading.com\/company\/contact\">contact<\/a> us to learn more. We advise you to research and learn the basics about futures investments. If you have the kind of personality that can handle the ups and downs of commodities trading, and if you want to build a relationship with a knowledgeable, trustworthy broker, trading with <a href=\"https:\/\/www.cannontrading.com\/\">Cannon Trading<\/a> is a good idea.<\/p>\n<p><strong>Disclaimer:<\/strong><\/p>\n<p>This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts\u00a0here in\u00a0contained are derived from sources believed to be\u00a0reliable,\u00a0but are not guaranteed as to\u00a0accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own\u00a0judgement\u00a0in trading.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Long-term success in futures trading usually doesn\u2019t begin overnight. You need to develop a proven trading technique that \u2013 more often as not \u2013 works. For new traders, Forbes\u00a0magazine is a solid source for financial information. In one article, it flatly states, \u201cYou would be better off just giving your money to experienced traders . [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[67],"tags":[1199,16,1225],"class_list":["post-13443","post","type-post","status-publish","format-standard","hentry","category-future-trading-news","tag-commodities-trading","tag-futures-trading","tag-how-to-trade-in-futures"],"_links":{"self":[{"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/posts\/13443","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/comments?post=13443"}],"version-history":[{"count":8,"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/posts\/13443\/revisions"}],"predecessor-version":[{"id":13453,"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/posts\/13443\/revisions\/13453"}],"wp:attachment":[{"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/media?parent=13443"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/categories?post=13443"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.cannontrading.com\/tools\/support-resistance-levels\/wp-json\/wp\/v2\/tags?post=13443"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}