It is important for you to know the difference between trading futures and trading stocks before we share insights on futures. You share ownership with other investors and you own a part of company whenever you buy a stock. And with respect to Trading Futures, the selling and buying of commodity in the future always requires a contract. You just need to tie up resources in the form of margin and thus futures trading is as easy as trading stocks. Advantages of trading futures are as follows:
- Trading Long and Short –Once you decide direction you think the market is headed then it does not matter whether you are going short or long with futures.
- No Day Trading Limits –After IRS considers you a day trader, stocks can be traded only three times a day. The buying, selling of futures can be done any number of times in a day and quick profits as well as benefits can be taken from intraday swings.
- No Wash Sales Penalties –There is no penalties from IRS if you take a loss and reenter the same trade within a month. Futures pricing are recorded market to market and thus it is not penalized for futures.
- 24 Hours Trading –Except on weekends, trading in futures is nearly around the clock.
- European Style Trading –Stock options follow American style while most futures options trade European style.
- Tax Advantage –Options on futures are treated according to IRS section 1256. There is always a tax advantage as 60% of all gains are considered long term.
Founded in 2005, ABans Group has grown from being a trading house to a dynamic and diversified business group.We provide expertise in broking services, merchant banking, non-banking financial dealings, jewellery manufacturing, realty &infrastructure. It is a comprehensive financial services & solution provider,which aims to provide an end-to-end financial solution to its clients.
