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Equity Index Futures give investors exposure to price movements of an underlying Index. Participants can invest in a basket of equities without trading the individual constituent equities. A futures contract gives the investor the right to buy/sell an underlying listed financial instrument at a fixed price on a future date.
Benefits
- Capital efficient way to participate in shares
- Incur lower brokerage fees than actually trading in the underlying shares
- Take advantage of price movements in the underlying index
- Liquid and easily traded
- Portfolio Diversification
- Short Selling
Who should use this product?
- Hedgers seeking to reduce risk against adverse price movements
- Speculators hoping to make a profit on short-term movements in the underlying
- Investors wanting to diversify their portfolios
- Investor wanting to invest in a basket of listed companies without the hassle of trading in the individual shares.
How to use this product?
- When trading in Index Futures an investor can either buy long or sell short
- An Initial Margin Deposit (or good faith deposit) is required when trading
- Variation Margin (Profits or losses) are calculated daily and flow daily.
- These are cash settled contracts
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Learn more about Equity Index Futures |
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