Futures Clearing firm pay interest?

Discussion in 'Index Futures' started by blueraincap, May 21, 2015.

  1. but wouldnt it make more sense to require the trader himself to post up the margin (ie increased margin requirement) instead of making the broker to pay up which cost will eventually end up in commission
     
    #21     May 27, 2015
  2. mmt

    mmt

    Advantage Futures advertises $0.07 per contract once you hit 10,000 contracts in a month. Wedbush is also very competitive. FC Stone, GH Financial, Phillip Capital, UOB also offer decent rates.

    If you trade a conservative strategy without large overnight positions (relative to deposit) you can trade for $0.05 after generating about $20,000 in commissions (at a higher rate of say $0.25).

    So, if you pay $0.10 and the notional value of a futures is $100,000, commission is 0.01bps. (It will be about 0.1bps with exchange fees).
     
    #22     May 27, 2015
  3. rmorse

    rmorse Sponsor

    No not really. They FCM is expected to take steps to reduce risk to the system. The best way to do that is have them make a financial commitment.
     
    #23     May 28, 2015
  4. thanks. didnt know that before. is there any summarised resource such as a detailed article or a book where I can learn about these uninteresting details about the futures industry? I predict the chinese market will present some interesting opportunities going forward.
     
    #24     May 28, 2015
  5. just21

    just21

    At Interactive Brokers the universal account is a securities and futures account rolled into one so you can be long dividend paying stocks and use them as margin to trade futures and options on futures.
     
    #25     May 28, 2015
  6. rmorse

    rmorse Sponsor

    I know that IB represents that and so do other online brokers, but all futures accounts must be a segregated futures account, not commingled with your securities account. They internally move the monies needed for futures margin. The securities account gets SIPC protection and the futures account does not.
     
    #26     May 28, 2015