Binance futures trading8/28/2023 ![]() ![]() Short exposure: traders can bet against an asset’s performance even if they don’t have it. Hedging and risk management: this was the main reason why futures were invented. The longer the time gap, the higher the carrying costs, the larger the potential future price uncertainty, and the larger the potential price gap between the spot and futures market. However, many futures markets now have a cash settlement, meaning that only the equivalent cash value is settled (there is no physical exchange of goods).Īdditionally, the price for gold or wheat in a futures market may be different depending on how far is the contract settlement date. As a consequence, gold or wheat has to be stored and transported, which creates additional costs (known as carrying costs). ![]() In some traditional futures markets, these contracts are marked for delivery, meaning that there is a physical delivery of the commodity. Instead, they are trading a contract representation of those, and the actual trading of assets (or cash) will happen in the future - when the contract is exercised.Īs a simple example, consider the case of a futures contract of a physical commodity, like wheat, or gold. Also, a futures market doesn’t allow users to directly purchase or sell the commodity or digital asset. Instead, two counterparties will trade a contract, that defines the settlement at a future date. Unlike a traditional spot market, in a futures market, the trades are not ‘settled’ instantly. Prior to trading virtual currencies, please view NFA & CFTC advisories providing more information on these potentially significant risks.A futures contract is an agreement to buy or sell a commodity, currency, or another instrument at a predetermined price at a specified time in the future. The trading of virtual currencies and Bitcoin futures carries additional risk. Past performance is not necessarily indicative of future results. Investors should understand the risks involved in trading and carefully consider whether such trading is suitable in light of their financial circumstances and resources. This is not an offer or solicitation for brokerage services or other products or services in any jurisdiction where Tradovate is not authorized to do business or where such offer or solicitation would be contrary to local laws and regulations of that jurisdiction.įutures and options trading involves substantial risk of loss and is not suitable for all investors. Tradovate, LLC is a member of the NFA and registered with the CFTC. Exchange, clearing and NFA fees still apply.īrokerage services are provided by Tradovate, LLC. ![]() Tradovate, LLC does not charge platform fees. Tradovate is an NFA registered futures commission merchant (NFA ID# 0309379) that accepts orders and receives customer funds to support such orders to traders of futures exchange products. Tradovate, LLC is an NFA registered introducing broker (NFA ID# 0484683) providing brokerage services to traders of futures exchange products. Tradovate Holdings, LLC Affiliates: Tradovate Technologies, LLC is a software development company that owns and supports all proprietary technology relating to and including the Tradovate Platform. ![]() Testimonials appearing on this website may not be representative of other clients or customers and is not a guarantee of future performance or success. ![]()
0 Comments
Leave a Reply.AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |