Trade in options and futures brokerage


Ever since the s, the majority of commodity contracts traded are financial derivatives with financial underlying assets such as stock indexes and currencies. Naturally, few people would trade futures if it required that they stand in the trading pit. If the exchange succeeds, it will have designed a futures product that many players can use or trade, and volume in the futures will grow. That means that a futures trader does not have to worry about any default of a futures counterparty. This trade in options and futures brokerage the commodity equivalent to a registered representative.

IBs do not actually hold customer funds to margin. What happens if that person cannot pay? A commodity pool is essentially the commodity equivalent to a mutual fund.

Views Read Edit View history. Working with participants in the industry such as traders, fund managers and natural hedgers, a futures exchange designs a contract to meet the greatest need. The clearing corporation's elimination of such counterparty credit trade in options and futures brokerage provides a great benefit to the futures and options markets. What happens if that person cannot pay?

Ever since the s, the majority of commodity contracts traded are financial derivatives with financial underlying assets such as stock indexes and currencies. Futures contracts are very specific in terms of the quality and quantity of goods underlying the contract. The trade in options and futures brokerage is the futures exchange. Trading occurs against a background of regulatory surveliance and guidelines from the exchange itself and from the Commodity Futures Trading Commission CFTC. A firm or individual who trades for his own account is called a trader.

The market for options on futures is structured in very much the same manner. Floor trading is conducted in the pits of a commodity exchange via open outcry. Ever since the s, the majority of commodity contracts traded are financial derivatives with financial underlying assets such as stock indexes and currencies. Futures contracts are very specific in terms of the quality and quantity of goods underlying the contract. Naturally, few people would trade futures if it trade in options and futures brokerage that they stand in the trading pit.

By law, futures brokers do not have the authority to take customer funds and hold them in deposit. You may have wondered who determines these specifications. Matching these two together so that a trade can be consummated requires the participation of a host of individuals and organizations, each having specific roles, which in the aggregate make the trade in options and futures brokerage market the efficient mechanism that it is today.