How to choose a futures broker

The vast majority of people who are looking for a futures brokers do it with the typical “day trading” mentality, which have been acquired through one thousand marketing channels.

As with any other frequent trading industry, the futures one is perfectly lubricated.

Nonetheless, the futures industry is perhaps the most professional when it comes to “day trading” and related matters.

The great majority of futures contracts are worth more than 100.000 dollars.

Nowadays we can buy stock CFDs with 1.000 dollars or pounds with a margin of 100 or 50 units.

Also, we can buy those 1.000 units in actual stocks, or more if the broker offers us credit.

In Forex we can trade 1.000 units with a margin of 10 or less.

This does not happen in futures.

Apart from a few contracts, the rest of the futures are quite big, just as it was in the old Forex industry long time ago when people could only trade 100.000 units lots.

Therefore, in futures we are talking about the VIP of day trading; where the retail traders have to be better capitalized and prepared.

There is not lack of courses and formation for that thought.

It is also truth that there is well prepared people who trade futures; however this is not the usual case.

The amount of SCAMs is not as big as in other industries, but there still are some of them.

Normally, when you lose in futures is because you have been a bad trader, and when you win you will be able to take your profits home without hassle.

Day trading futures brokers

Hence, it seems clear that the majority of individuals are looking for a futures broker to do day trading.

There are people with 2.000 pounds of dollars who think that they can beat a market like the futures one.

Choose a futures broker is quite easy since almost all the brokers in the industry are well regulated and are quite reliable.

Without a doubt the best futures brokers in the World are the American ones, where this industry is strongest.

When we want to choose a futures broker we have to pay attention to commissions since they are so important in our trading costs, especially if we want to do day trading. If we do swing and trend trading they are less important.

However, in futures there is another cost more important than the commission: the spread, which is actually bigger than commissions most of the time.

For instance, the SP&500 have a spread of USD 12.5 spread every time we buy and sell, what means that we pay 25 USD every time we trade that contract (ES).

If we add a commission of 10 USD to get in an out we can see how we are paying a lot to trade a future contract (25 + 10 = 35).

With that kind of cost it is not wonder that people who try to “scalp” the market for 150 USD do not go very far in their trading endeavours.

American futures brokers

As I said before, the best futures brokers are in America.

The offer is quite big and with good conditions, for instance: Interactive Brokers, Global Futures, Ninja Trader, Velocity Futures, Futures Online, MB Trading, Optimus Trading, TradeStation, Infinity Futures, ATC Brokers and many more.

There are, also, very good futures brokers in Asia, like Philip Futures in Singapore, covering most of the popular Asian contracts.

There are also some good futures brokers in Europe, although not many.

Futures brokers to win


The difficult thing here is not what futures broker we choose actually, but to be able to win doing day trading.

I personally advise not to try futures day trading, especially if you have small experience or capital.

If we make 200.000 dollars or pounds a year and want to trade it may be not very harmful to lose some money trading futures, but if you have little money it is better that you stay away.

For instance, if we only have 5.000 dollars and are able to save up 200 a month, it is better we try other things because our “futures” adventure is very likely to end up badly.

The world of trading is very difficult, and the futures one is not less despite being one of the most prestigious and serious trading markets in the World.

In this market, as well as in any other, it would be good to try some demo accounts and see how it goes before embarking in such enterprise.

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