In this article, we have grouped the best brokers and platforms for investing in futures.
In choosing them, we considered the following factors:
- The overall quality of the broker
- The commissions charged by the broker on futures
- The ways of investing in futures offered by the broker
Summary
WARNING
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.
Between 74-89% of retail investor accounts lose money when trading CFDs.
You should consider whether you can afford to take the high risk of losing your money
Review
- DEGIRO is a European broker that allows you to trade futures.
- On DEGIRO you can trade futures on indices, stocks, commodities, and fixed income.
- Futures trading costs are €0.75 per contract on DEGIRO.
- DEGIRO offers many account types, but the only ones that support futures are the DEGIRO Active accounts and the DEGIRO Trader account.
Visit DEGIRO
(Investing involves risk of loss)
- Interactive Brokers allows trading a large number of futures on over 30 North American, Asian, and European exchanges.
- IB offers a large number of futures on the crypto, forex, stock, and index markets.
- IB’s fees per futures contract decrease as volume increases.
- For U.S. futures, IB charges commissions per contract of $0.85, which decrease to $0.25 if more than 20,000 contracts are purchased per month.
- IB also offers a large number of e-mini futures, with commissions starting at US$0.10 per contract and increasing to US$0.25 as volume decreases..
Visit Interactive Brokers
(74-89% of retail CFD accounts lose money)
- On Fineco you will be able to trade IDEM, EUREX, and CME futures.
- Among them you will be able to trade futures on the US market and also the European market.
- On Fineco you will also be able to find e-mini futures so you can open trading positions with lower volumes.
- Commissions start at $0.95, and decrease as trading volumes increase: below €499 traded the commission is maximum, between €499 and €1,499 it is intermediate, and the minimum is obtained for volumes above €1,500.
- Fineco allows a margin of up to 1% to be used on futures.
Visit Fineco
((74-89% retail investor accounts lose money))
- With Saxo Bank you can trade over 300 futures on more than 20 global exchanges.
- Commissions on Saxo Bank on futures vary by country of residence of the trader, by account type, and by trading volume.
- On the Saxo Bank Classic account, futures loads a $6/trade fee, while it is $3/trade fee on the Platinum account, and $1.25/trade fee on the VIP account.
- For those trading volumes above 5,000 contracts per month, pricing is customizable.
Visit Saxo Bank
72% of retail CFD accounts lose money
- On eToro you can trade futures on commodities markets.
- Futures at eToro focus primarily on soft commodities, but there are also futures on metals and the energy sector.
- In total, you can trade over 10 different futures on eToro.
- eToro charges a spread on futures, and this means that the fees are variable, and change based on the state of the market.
Visit eToro
(79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money)
- At IG Markets you can trade over 15 CFD futures on stocks, commodities and bonds.
- The only commission charged on futures by IG is the spread, which is not fixed but varies according to the state of the markets.
- Thanks to CFDs on futures, you can go both long and short with IG Markets.
- By trading Futures in CFDs, overnight fees will be charged at market close if the trade is left open.
Visit IG Markets
(76% of retail investor accounts lose money)
- Forex.com allows you to trade futures on over 10 different exchanges.
- Futures offered by Forex.com include the forex, crypto and commodities markets.
- Forex.com futures fees are not fixed but vary based on the state of the market.
Visit Forex.com
(73% of retail CFD accounts lose money)
- A total of 10 commodities and index market futures can be traded on Admirals.
- Admirals charges spreads instead of charging fixed fees, and these vary by market and futures contract traded.
- To trade futures on Admirals you must download the MT5 platform.
Visit Admirals
(76% of retail CFD accounts lose money)
- Futures trading on Tickmill is dedicated to UK resident clients.
- Tickmill offers trading on over 80 futures on 7 different exchanges.
- Futures markets offered by Tickmil include the forex, index, and commodities markets.
- Fees on Tickmill futures are $1.30 per standard contract, and $0.85 per micro contract.
Visit Tickmill
(79% of retail CFD accounts lose money)
- Coinbase is a cryptocurrency exchange that also offers futures trading.
- There are 5 futures offered by Coinbase. These are, Ethereum, Bitcoin, US500, FAANG Stocks, and Oil.
- On Coinbase futures can also be found as micro and nano for lower trading costs.
- Fees vary by futures traded, but typically start at $0.07 per contract traded when trading mini-futures.
Visit Coinbase
(74-89% retail investor accounts lose money)
How much money does it take to trade futures?
To start trading futures, an investment of at least $300 is generally needed.
With this amount each trader, considering the maximum leverage of 1:10, will be able to have the margin needed to invest in a good portion of the futures on the market.
The amount to be invested, however, can be lower or higher depending on the minimum margin allowed by the broker for certain categories of assets (such as index futures).
Types of futures contracts
The main types of futures contracts are:
- Futures on stock indices, such as the S&P 500
- Futures on currencies, such as the EUR/USD exchange rate
- Futures on commodities, which in turn are divided into Hard (such as precious metals) and Soft (such as coffee and wheat)
- Bond futures, such as government bonds
Can leverage be used to trade futures?
Futures can be traded with leverage up to 1:10 depending on the broker’s policy.
Trading with 1:10 leverage means multiplying the market exposure of one’s investments by 10, thus causing greater losses or gains depending on the outcome of the trade.
In other words, investing $100 will allow one to invest in a futures contract that is worth $1000, but the gains and losses from trading the latter will be projected onto the $100 invested.
So if the futures contract closes at $990, i.e. loses 1% of its value, the trader will lose $10 on the $100 invested (i.e.10%), and not just $1 as would have happened if he had not used leverage.
Pros and cons of investing in futures
Pros
The main advantages of investing in futures include the transparency of the market, the fact that it is a market based on tangible assets, and that it is virtually impossible to manipulate market prices.
In fact, futures prices vary based on tangible future events and scenarios that can tangibly alter supply-demand laws. This characteristic makes futures one of the most transparent assets in which to invest.
Cons
However, investing in the futures market is one of the most complex assets to carry out effectively.
Each futures asset, even if part of the same category, is regulated by different market laws. To predict the change in valuation on coffee and soybean futures contracts, two totally different types of valuation must be carried out.This requires not only knowledge of technical analysis, but also requires individual knowledge of how coffee and soybean crops work, which countries produce the most, what are the ideal conditions for getting a better or poorer crop, what are the main varieties and what natural needs they have, and much more.
How long do futures contracts last?
Futures contracts have a monthly maturity.
This means that there is one futures contract for each month. If you don’t want to trade a futures with such a low maturity, you can invest in the following months’ futures.
In other words, if it is early January and you want to invest in a long-term futures, you can buy April, September or December ones depending on how long you are willing to keep the position open.
Can I trade futures without a broker?
Trading futures always requires an intermediary, whether it is a bank or a broker.
In fact, futures are a complex market to access without having a brokerage entity.
As with stocks, futures are listed on particular exchanges that accept order requests only from institutions.
If you do not want to open a trading account with a broker, you can ask your bank if they offer investment services. If so, your bank may give you the ability to buy and sell futures through their systems.
However, always consider the fact that brokers generally offer much more competitive fees than banks.
