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Financial markets are huge. Daily billions of dollars change hands in these markets when different financial instruments change hands.

You can trade stocks.

You can trade bonds. Ever heard of the futures market and futures trading? Well, futures are a security just like stocks and bonds. Stocks give you the ownership in part of a company while bonds are issued by governments and companies to borrow money from the investors. Futures are somewhat different than stocks and bonds! Futures contract as the name implies is a binding contract between two parties for the delivery of a commodity or an asset or even a financial instrument at some future date between the buyer and seller of that contract. Futures market is a highly regulated market with the CFTC responsible for its regulation. Buyers and sellers don't come in direct contact with each other.

In between is the Central Clearing House that enforces the contract reducing the risk of party default! Futures market is the backbone of the whole sale and retail commodity market ranging from oil, wheat, corn, heating oil, meat, cattle, soybeans and other foodstuff. So you can well imagine the importance of the futures market. Futures market serves the purpose of hedging and speculation. Futures contracts are by design meant to limit the amount of time and risk exposure experienced by hedgers and speculators. What this means is that all futures contracts are time bound and at some point in the future they expire.

In the last decades, electronic trading has become highly popular among the traders. This includes futures as well. So, now you can easily trade these contracts by opening an account with a FCM brokerage and deposit an amount to start trading these contracts on margin.

The minimum amount with most of the brokers is something like $5,000 but it can less too! Brokers allow leverage upto 10:1 when you trade on margin. Compare this to the leverage of 2:1 allowed by stock brokers. Electronic trading has lowered commissions and other transaction costs for trading these contracts plus price discovery is better and there is a more level playing field for all the players in the market.

In old times, futures contracts got traded on Futures Exchanges in open outcry pits.

It still takes place on the floor of these exchanges but with the advent of electronic trading most of the trading is now shifting to electronic platforms. GLOBEX is the most important platform for trading different futures contracts. CME, NYMEX and CBOT are the three most important Futures Exchanges. GLOBEX allows you to trade most of the contracts that get traded on these exchanges.

The popular contracts that get traded on GLOBEX are the E-minis like the S&P 500, NASDAQ 100 and Dow.

You can also trade E-mini gold futures as well as crude oil futures on GLOBEX. Now, GLOBEX trading continues during the night after the official close of CME, CBOT and NYMEX at 4:15 PM EST. However, overnight trading can be thin and highly volatile as compared to the official hours.

You can find GLOBEX quotes on CNBC and Bloomberg! These quotes are real time. Futures trading can be highly profitable but risky as well. Before you dabble in them, you should paper trade these contracts for at least a month just to get a feel of how to do it.

There are many contracts that you can trade and the possibilities of making money in futures trading are immense.

Imagine the prices of crude oil going up again just like what happened in the summer of 2008!
Mr. Ahmad Hassam has done Masters from Harvard University. Get this 49 page Quantum Dow Futures Secret that can make you rich!

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