Questions tagged [futures]
For questions relating to futures contracts.
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References/terms to search for regarding financial instrument universe selection
When attempting to profit off of the market in one way or another, an entity, be it a fund, individual investor, institution, etc., must first decide on what actual financial instruments are to be ...
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Trying to teach myself futures ,have some queries
I understand the basic idea of futures when it comes to like hedging and companies using it to manage costs, however when it comes to trading them I am completely lost.
All i know is that in a market ...
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Is Having a Superior Spot Predictor Sufficient for Making Money in Futures?
My friend is encouraging me to get into futures trading, but before I do I want to understand something.
Is having a better spot predictor than everybody else sufficient to make money in futures?
For ...
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Market Structure for Futures
I'm confused about how payment for futures contracts works if one sells before expiry. Consider the following scenario with a contract for delivery of good X:
A sells a futures contract to B for $50
...
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How to properly hedge indices futures NQ by selling leveraged index options TQQQ or SQQQ?
Is there a formal futures NQ vs TQQQ options contracts hedging ratio calculation/strategy to tap on the fast decaying value of weekly expiry TQQQ options thereby creating an asymmetric risk-reward ...
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S&P ES Futures Pricing Vs SPY/SPX
Is there an accurate and strategic ratio between the price of the ES E-mini Futures and that of SPY? Despite the Quarterly rollovers, given the current quarter, I notice that typically ES is higher by ...
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Comparing option deltas of significantly different underlyings
Please help me correct or confirm my intuition about options deltas. My understanding is that delta is the change in an option's price given a $1 change in the option's underlying. Moreover it's ...
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How do the practicalities of futures contracts for commodities work?
I know in principle how future contracts work (and correct me if I'm wrong):
Essentially, provides a contract holder with the right to buy a commodity in the future at a given price.
This part, and ...
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is future contract price fixed or not?
I thought that Future contract is an agreement to buy or sell an asset at a certain future time and a predetermined fixed price. So if, for example, I need to get 1000 GBP next June, but I am afraid ...
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How does daily futures settlement work when the futures are backed by bonds/bills?
I've got a futures account at ETrade which is backed by a normal trading account. If I put cash into the trading account it shows up as buying power in the futures account, and if I have a futures ...
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Why less leverage is allowed for cryptocurrency Spot trading?
I realized brokers and exchanges allow high leverage for Futures, Options and Forex listings but not so much for spot listings.
For example in Kraken Futures you can get 50x leverage for BTC-Perpetual,...
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Not understanding futures price
I don't fully understand Futures & Forward pricing. I know that there is a delivery price and the actual future price. And that at the time of issuing, the future price is identical to the ...
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Forward vs Future rates
Looking at the market data for USD/CHF on investing.com and can't get my head around the difference between the forward and futures rates for this pair.
USD/CHF spot rate is 0.9898
MAR23 Futures ...
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How to know increasing open interest indicates new short contracts or longs contracts?
I trade on crypto market and recently I have learned that there is a tool or something named open interest which tells you the amount of long and short open contracts at any time.
It is really helpful ...
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Pricing Futures with Short Sell Restrictions and Borrowing/Lending Costs
From the book "Derivatives for the trading floor" by Patrick Boyle, it has no answers, so I'm curious as to what they are.
In a free market from transaction costs, arbitrage opportunities, ...
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Why do the quarterly "PM settled" options for the S&P 500 futures have about 1000 points between each strike price?
I'm looking at the options chain for the S&P 500 futures. Almost every option contract I look at, whether it's a daily option, weekly option, monthly option, or quarterly "AM settled" ...
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Why can't I do an adaptive order on Futures Options?
Interactive Brokers has the ability to adaptive algorithmic orders that (I'm simplifying this greatly) can split the difference in the bid ask price without human intervention. I can do these types of ...
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Futures Options: Options Expiration vs. Underlying Delivery
Does the expiration of a futures option always determine the delivery date of the underlying, in particular does the option always expire into the earliest-delivering futures contract?
For example, /...
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VIX futures margin calculation
I'm new to futures and I'm trying to understand how margin is calculated when it comes to VIX. For the sake of example, let's say VIX is 20 today and 60 day VIX futures are selling for 25. So far, ...
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How futures contracts are managed by the exchange
Please, confirm my current understanding of how futures work. Let’s consider cash-settled futures for simplicity.
The number of futures contracts (with identical parameters) is unlimited. New futures ...
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Is there a theta in futures?
Is there a theta/delta (like in options) in futures? I mean, if the spot price of the underlying (for example: crude oil) up $5, Is there a ratio that the front 6 months contract will be affected, and ...
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Why do i see this significant dip in OI on the first tick
Why do we see a huge(relatively) dip in OI on the first tick when the market opens ?
Does this happens because people closing out their previous position the moment market opens ? Or there is ...
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Short postion - Futures contract
Assuming that an investor holds his short position until maturity and that he cannot close out his position. Will a seller that doesn't own the underlying ever enter into such a position?
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Where can one buy futures contracts to insure against large energy bills due to natural gas price increase?
My energy contract will be renewed at the end of the year. The extremely large increase in the natural gas price means that I'm not going to opt for a fixed energy price for several years, I'll ...
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Does an online trader affect futures prices as a real (physical) trader?
When I buy a future contract (1 contract), will I affect the price and volume and the other numbers, the same as a physical trader (if he buys 1 contract), Will the trade volume increased by two or ...
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What happens if a futures exchange increases margin requirements while I have open positions?
Specifically, what happens if my current position is already close to (or at) the maintenance margin level and the exchange then increases margin requirements?
For example,
First Day (end-of-day):
...
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Are commodities ETFs risky as commodities futures in needing margin calls and limited time to hold or they are like stocks?
Are commodities ETFs risky as commodities futures in terms of needing a large ammount of balance and margin calls and limited time to hold, or they are like stocks?
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When I take a position in a perpetual future (e.g. 3x long), must there be someone holding the opposite position (3x short)?
When I take a position in a perpetual future (e.g. 3x long), must there be someone holding the opposite position (3x short)?
If so, suppose I entered a long 3x position on an asset at $100 and you ...
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Do ETF/ETNs invest directly in futures or forex, or do they just invest in stocks and bonds?
Do ETF/ETNs invest directly in futures or forex? Or do they just invest in stocks and bonds?
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How is the first price of us treasury futures decided?
How is the first price of u.s treasury futures decided? Does it depend on the last price of the previous future contract ?
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Who are the non-speculative buyers of futures options?
I am trying to understand who would be a non-speculative buyer of options contracts on futures. There are a plenty of descriptions of how options work online, but mostly they omit this crucial part of ...
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What is happening during the maintenance hour of E-Mini S&P 500?
I'm trying to better understand the trading hours of the E-mini 500 S&P, which according to the CME Groups web pages are shown like this:
This is, however, rather incomprehensible for anyone non-...
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Trading Places (1983 film): Is it really possible for futures exchanges to seize their members' assets?
I am trying to understand a scene in Trading Places (1983 film).
After Randolph and Mortimer Duke failed to corner the frozen concentrated orange juice (FCOJ) futures market, the following ...
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Can you explain to me, in what months are the futures and options on gold and silver listed, based on the CME description?
I read the following contract specifications from CME and couldn't figure out/understand it.
On Gold;
Futures: Monthly contracts listed for 3 consecutive months, any Feb, Apr, Aug, Oct in the nearest ...
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Questions about Margin in the Futures
(I'm beginner)
1- Can I buy/pay the whole contract price without margin (the broker will have no risk at all then- no need for maintenace margin) ?
2- Is this borrowing money so I need to pay interest ...
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Why there are duplicated option chains in futures?
As in the screenshot, there are two and three similar option for the same contract with same expiry date. What is the reason ?
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How to read double apostrophe prices in futures options?
How to read double apostrophe prices in futures options?
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Are future options per 100 unit?
In futures (for commodities, indices, fx...); Is 1 option for 100 future contracts ?
For example:
If I want to make a covered call option for Gold and for micro Dow jones future, How much should I buy ...
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Why are the futures prices different from the buying power effect?
I'm beginner,
When I buy 1 share of a $10 stock, the buying power effect/costs = $10+Commission
but in futures, the cost is very different from the quoted price, is futures quoted price different from ...
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What do single quotation marks in the price of futures mean?
What are those single quotation marks in the price, and how to read them?
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How to calculate the price of 1 Kilogram of each traded-commodity?
What does the quoted price of each of the below commodities represent ? (eg: Gold price below = 1 ounce ; cooper = ...1 ton ?)
How can I convert the listed prices to show the price of 1 Kilogram of ...
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Why short (German) government bond futures?
Today, mainly out of curiosity, I went to a major ETF comparison website and sorted the short ETFs by market value. I was surprised when among the first few places in the list I found an ETF (LYX0FW) ...
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Backwardation or Contango?
I was looking for graphs of backwardation and contango but I've found seemingly contradictory image results:
For instance this image and this one show contago on top, but this one shows it on the ...
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Why not sell ETNs (Exchange Traded Notes) untethered from roll yield?
I rewrote these two questions with numbers and edits.
Pls explain like I'm 5. I don't understand any of the comments that just raise more questions! What the heck's "a predictable and ...
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Where would my futures contracts go if the counterparty gets liquidated?
What would happen to my futures contracts such as S&P500 futures if the counterparty of my contracts gets liquidated due to a heavy use of leverage? Since futures contracts are made between two ...
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Is there something like a covered call for futures?
I am making my first baby steps in learning about future contracts.
In the option market there is something like a covered call, where one can limit the upside risk to the loss of the shares one ...
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How futures are sold, when they are first released?
When termed futures are released in the market, such as XBTU21 (Bitcoin futures for the 3rd quarter), how are they sold in the market?
Stocks, for example, are sold through IPO when they are first ...
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Am I understanding the math of this futures contract trade correctly?
DISCLAIMER: To be clear, I have zero interest in trading futures. I don't have the knowledge, risk appetite, or capital for that. I'm just asking this to learn.
The S&P 500 closed at 3,939.43 on ...
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TNote 10yr Futures YTM vs market yield?
I understand how to calculate the yield on a 10 yr TNote based on face, price & coupon.
I don’t understand why the yield (and price) on a futures contract about to expire is so different than the ...
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Size of market for physically delivered futures
I understand the difference between cash settled and physically setted futures contracts. I also know that most physically settled contracts end up not being exercised and are closed before expiration....
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