Trading futures - what's the difference?


Hi all

I have been trading stocks, FX and indices (through SB) for a while and have finally got to a stage where I am comfortable with what I am doing. Still have a lot to learn but seem to be constantly improving :) .

However, my long term aim is to eventually move to futures and trade something like the S&P or Dow minis. I intend to paper-trade for the next six months on these and make sure that at least on paper I can adapt to them and see which one suits me best.

Anyway, what I am after is any guidance from those who trade futures on what I should aware of. Do you have any golden nuggets of information to share. You know the ones where you go 'I wish I'd have found that out sooner' or 'if only someone could have told me that'.

Is there anything you could recommend that I read first?

I just want to stop myself from making any obviously and costly mistakes that could have been so easily avoided.

Thanks in advance.



There seems to be a lot of fear among people who trade with SB`s who want to trade future`s. If you have traded SB`s, especially index`s, you have nothing to fear at all.

Future`s are just better. The quotes you get from a SB firm for an index are based on the futures and move at the same time and rate as futures, so you are already used to the speed of them.

BUT with direct access futures you get a spread of 1point on the Dow (YM), or 2.5 points on the S+P (ES) or 5 points on the nasdaq (NQ). with D4F which is the SB firm with the tightest spreads, you have a spread of 5 on the Dow, 5 on the S+P and 20 points on the Nasdaq! ( I am taking a point on the S+P and the Nasdaq as 0.1).

Plus you get near instant fills with direct access, no waiting when the market is at obvious S/R levels, no waiting because you know what you are doing and they want to screw your entry price, cause they don`t hedge like some adverts say they do. Allegedly, for the lawyers among you

Also with the mini futures you don`t have to start big, the YM at current exchange rates is now less than £3 a point per contract.
I know some would have you believe there is no volume on the YM, but from one who actually trades it I say, I`ve had no problems at all up to and including 3 contracts. (I was having problems by £5 a point with SB firms!)

Just remember there are loads of scalpers on the various index futures who are closing their trades for a profit before you`ve paid the spread with some of the more expensive SB firms.

You may have noticed I`m slightly biased toward direct access futures, as opposed to SB firms. :cheesy:

Much as Steve says. The only real potential downside is the obvious one that the lower limit that you can place on your exposure is lower. With D4F SBs you can put £1 a point on, with futures it's 25euro on the Dax, 10 euro on the ESTX, £10 on the FTSE etc.

You won't find guaranteed stops available either.
futures v. sb

Hi L42,
Just come accross your post.
I don't trade futures-yet; I'm in much the same position as you.

Take a look on for an excellent comparison of the pro's and con's of futures v. SB.
This was compiled by HelenQ and is as clear and concise as one could hope for.

For good quality information also seek out threads and posts by TBS (the blind squirrel) on are worth looking at too.

Hope this helps, albeit rather late in comming.
Best Regards,