Are Future Trading Systems for You?

By: Anne Durrell

Trading in stock futures can be risky and complicated. People buy stock futures to hedge their investments so that on one market blip either way up or way down will cause them to lose all their money. When buying a stock future, the two parties agree upon a fair price, which probably won't be too high or too low. This way, neither of you stands to lose everything in a volatile market. Though stock futures do specify a future date on which to buy a stock, futures contracts are not usually held to the expiration date, but bought and sold on a futures market based upon their relative values.

Anyone who wants to make money with stock futures contracts needs to have the analysis skills of a financial genius or use a future trading system. Actually, even the geniuses use future trading systems. Investors who use future trading systems out earn those who do not. Some traders using these programs systematically over the long term make nearly 20% more on average than those who do not.

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future trading systems allow investors to practice futures trading without committing any money. This way, the investor can sharpen his or her skills by practicing with many different market conditions. Learning to do real time futures trading without using actual money is a good way for investors to learn to trade based on objective conditions rather than emotions. Trading in stock futures based on emotion is a sure way to go broke.

But future trading systems can also be used to automate futures orders based on certain conditions. This reduces the chances of human error and helps take the emotions out of the transactions.

In the United States, futures trades are regulated by the Commodity Futures Trading Commission, or CFTC, which is an independent agency of the U.S. government. The CFTC has the authority to issue fines and other punishments to companies or individuals who break futures trading rules. Every Friday, the CFTC issues a report on the open interest of futures market participants. This is simply a measure of the total number of derivative contracts active on a particular futures sector. It is a way of charting the flow of money into and out of the futures markets.

This Commitments of Traders Report, or COTR, is used by speculators to help them make decisions on taking a short or long position. Two different theories of how to go about this are :

to take whatever position is the opposite of the non-reported position; and
taking the same position as commercial traders is the wise thing to do.

It certainly isn't a lack of information that makes futures trading difficult and risky. Future trading systems can be used to sift through the mountains of information in order to make better options trading decisions.

Future Trading System

commodity future trading system

Are Future Trading Systems for You?

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