what do i get if i hold FTSE Futures till expiration?

Glenn

Experienced member
1,040 118
i just wondered what a person obtains once they hold FTSE futures till expiration

If using Direct Access, you will have an opposite trade assigned to yours, at the final EDSP price (Exchange Delivery Settlement Price). So you will end up being closed out and the EDSP price will determine whether you won or lost.

If you are using SB, then some types of bet are rolled over automatically to the next contract, otherwise you will be closed out at (hopefully) the EDSP price, as above.

Option expiry can be pretty hairy just before 10:30 am, although the authorities have tempered this somewhat now, but you could see, say, a 50 point move in the last few mins, for or against you.
In 1998, before the authorities clamped down, this is what happened on 21st March:-
"In just 15 seconds, between 10.15 and 15 seconds and 10.15 and 30 seconds, the index plunged by 160 points, only to soar by 140 points before the minute was up."

Glenn
 

ash87

Newbie
5 0
Thanks, thats cleared things up for me. i thought you would get a basket of FTSE shares at expiration. So from what your saying, the contract is just a way of allowing traders to speculate on the FTSE, nothing else?
 

Claudia123

Established member
724 56
ash if you don't understand FTSE futures do not trade them. Glenn made an excellent and very clear reply.
 

ash87

Newbie
5 0
Thanks Glenn for clearing that up for me. Appreciated :)

ash if you don't understand FTSE futures do not trade them. Glenn made an excellent and very clear reply.

Hi there Claudia, although im sure your comment was written with the best intentions i do however take issue with it. My question was curiosity based and hypothetical in nature.I do not trade FTSE futures or do i have plans to do so in the future.

On a more general point, the problem i have with responses such as this is that they tend to intimidate the newbie such as myself from asking future questions. A lot of the time when an inexperienced person asks a question, he/she gets many responses that imply that 'if such a question needs to be asked you shouldn't be on this site'. I'm sure you can appreciate that generally this type of response isn't that helpful.

Its not for you, me or anyone else to dictate what a person can or cant do with their money, only advice can be given. Its up to the person in question to decide whether or not to discard the advice given.

I think forums are places where people share ideas and ask for advice. Although I may be inexperienced today, some time down the line i wont be. when that time comes i hope i can contribute to this forum by giving an as in depth response as i recieved from Glenn.

Thats my rant over. :cheesy:
 

GammaJammer

Experienced member
1,243 830
I am going to come down on the side of the OP here Claudia, sorry. I don't think the original question was an unreasonable one - and while it may have been a tad lazy (as this information is freely available on the internet to be honest) the OP ended up being justified in using T2W to ask the question, as the reply that came back was concise and at the same time detailed and probably very useful.
 

Claudia123

Established member
724 56
I am going to come down on the side of the OP here Claudia, sorry. I don't think the original question was an unreasonable one - and while it may have been a tad lazy (as this information is freely available on the internet to be honest) the OP ended up being justified in using T2W to ask the question, as the reply that came back was concise and at the same time detailed and probably very useful.

No problem Gamma. My reply certainly not meant to offend theOP. And yes the reply that was posted was very good (thought I said that ??). Apologise to ash for any misunderstanding.
 

Splitlink

Legendary member
10,850 1,233
Thanks, thats cleared things up for me. i thought you would get a basket of FTSE shares at expiration. So from what your saying, the contract is just a way of allowing traders to speculate on the FTSE, nothing else?

Apart from the speculative aspect I believe that the original use of this instument was for funds and big investors with a basket of Footsie shares to hedge their holdings relatively easily during a setback in market conditions. Naturally, as soon as that happened the brokers saw a golden opportunity in selling straddles, etc. all of which bring in commissions from the buy side and the sell side at the same time and a whole new industry was formed.

I note your protest to Claudia. He must have got out of the wrong side this morning, or was it yesterday.. He's not normally like that. :D
 

timsk

Legendary member
7,344 2,136
I note your protest to Claudia. He must have got out of the wrong side this morning, or was it yesterday.. He's not normally like that. :D
I think I've found an insight into your trading style and beliefs that clears up a lot of issues for me, as your the only member (that I'm aware of) who appears to think that Claudia is a bloke, as opposed to the drop dead gorgeous babe the rest of us think she is!
:cheesy:
 

Splitlink

Legendary member
10,850 1,233
I think I've found an insight into your trading style and beliefs that clears up a lot of issues for me, as your the only member (that I'm aware of) who appears to think that Claudia is a bloke, as opposed to the drop dead gorgeous babe the rest of us think she is!
:cheesy:

:LOL: I thought that it was a weird name for a bloke, but didn't pay too much attention to it. I go for the nitty gritty, man!
 

arabianights

Legendary member
6,725 1,377
depends if it's cash or physical settlement, there are both

NEXT!

edit: this is in response to the post directly above
 
 
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