Futures are more about short-term trading. When you buy a futures contract, you are buying a financial instrument with an expiration date and whose short-term losses could force you to sell. However, you can also trade futures for the long term, but more likely you will trade with an eye on the clock, hoping to make a few bucks in the next few minutes, days or weeks.
You can take the advantage of leverage in the futures market; one can use a small amount of money to control a far larger amount. This is called leverage. This implies that you can start with Rs 5,000 and turn it into Rs 50,000. You can win or lose money trading stocks on margin. You can lose more in futures as futures are generally more levered.
- Only trade money you can afford to lose.
One of the best things about futures trading is that you can start with small amount of money and use leverage to turn it into more. However, an experienced trader can start from at least $5,000, and maybe a as much as $10,000. You must be prepared to lose all of it. Also keep in minds that if you cannot afford to lose it then do not dare to trade it.
- Ignore lofty promises.
You must never trust any analysts or pitchmen, saying you can support yourself by trading futures. Never do business with anyone who says it is easy.
- Educate yourself.
It is really important to educate yourself, if you are looking forward to trade in future. All of you who wanted to learn to trade futures must visit the blog of money classic Research, where you will get to know about the tips and tricks of trading in future. They ensure to provide quality and useful information to all the visitors in the knowledge corner of their website.