Comprehensive Guide to Futures Trading

Everything you need to know as someone getting started, or looking to expand on what you already know.

I feel like the quality of futures education I see floating around isn't too great. Most of stuff I see online is missing a lot of important things in my opinion.

So I will go ahead and make this guide, it will be good if you are just getting started, interested in getting into futures, or even already currently trading futures and looking to expand your knowledge.

Table of Content

• Getting started

  • What are Futures

    • Why Futures over other products

      • Taxes on futures

      • Liquidity

  • Different Futures Products / Instruments

    • Index

    • Commodities

    • Bonds

    • Agriculture

    • Currencies

  • How does Futures work ?

    • Leverage

    • Notional Value

    • Tick Value

Trading Futures

• Brokerages vs retail Prop Firm

• Software

  • Tradovate / Ninjatrader / Motivewave

    • Pros and Cons of each software

  • How to set up dashboard

  • Backtesting

• Order Types

  • Market vs Limit orders

  • Bracket orders

    • OCO - One cancels other

    • ATM brackets

    • Setting up Brackets

  • “Free trade” concept

• Getting started in (retail) prop firm

  • Approaching an evaluation and getting funded

  • Staying funded

  • Plan to pass evaluation

    • Looking at the market in ticks and points instead of dollars.

    • Technical approach to trading

• Building a trade plan with realistic goals.

  • Starting to look at futures with a technical approach

    • This will help remove some emotions, and FOMO trading

  • Breaking things down targets into points / ticks.

    • Using ATR so you can adjust in real time with the market.

  • Sizing and Risk management

• Prop Firms

  • My honest opinions and recommendations not influenced by any affiliate generated income.

I will also be including some video examples / screen recordings. I’m most likely going to have to make this a series, futures are a sophisticated product and there is alot to go over.

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What are Futures

Futures contracts are agreements to buy or sell a specific asset— like commodities or indices— at a fixed price on a future date. Most contracts are closed out before expiry, so the majority do not result in physical delivery, but allow participation in price movements without owning the asset.

• Index Futures are cash settled

• Commodities/Agricultural are deliverable

  • It is important to understand this, and roll or close contracts before expiry — or else you might end up with some cows or 1000 barrels of oil.

Why Choose Futures Over Other Products?

Futures have distinct benefits

• Leverage—Trade large positions with modest margin

• Liquidity—Futures are one of the most liquid products in the world

  • ES (E-Mini SP500) is one of the most liquid products you can trade