Tiger Brokers Hong Kong

A futures contract is a legal agreement between a buyer and seller to purchase or sell a specific commodity or asset at a predetermined price at a specified time in the future.

Buying or selling a futures contract means you agree to purchase or sell a specific quantity of a commodity or financial instrument at a predetermined price, with the delivery time depending on the contract you trade. Please note that Tiger Trade currently does not support physical delivery, Physical contracts need to be closed before the first notice day or the last trading day (whichever comes first). For non-physical contracts, they need to be closed before the last trading day.

Futures trading has many benefits. Firstly, it provides risk diversification, as futures offer a variety of commodities or assets such as gold, crude oil, stock indices, etc., enabling investors to diversify their investments. Secondly, futures trading has a leverage effect, by depositing a part of the margin, you can control the full amount of the trade, thereby improving the efficiency of capital utilization. Also, futures allow investors to manage expectations by locking in future prices to hedge market fluctuations. Finally, futures trading allows long or short positions, making profits possible regardless of market trends.

However, futures trading also carries risks. Market risks due to global economic conditions, policy changes, supply and demand relationships, etc., may cause price fluctuations, which can lead to investment losses. While leverage can amplify returns, it can also lead to losses exceeding the original investment when the market trend is unfavorable.

Margin requirements vary depending on the specific futures contract you trade and the exchange on which that contract trades. Before you begin trading, you must check the margin requirements for each contract. You can see important information such as margin and expiration date in the contract details via the following paths:

Mobile: 'Quotes - Futures' - select a contract - 'Contract Details'
Desktop: 'Quotes - Futures' - select a contract - 'Contract Details'

Each futures contract has a specific expiration date, thereafter it is no longer tradable. In general, the product lifespan lasts for few months. To better monitor the life cycle of the futures market, the "main contract" approach is widely adopted by the intermediaries.. "Main" refers to the current most actively traded contract, and the conjunction of the frequently traded contracts will illustrate the market trend across the periods. The main contract itself is not tradable; when trading the main contract, you are literally trading the most active contracts. While trading the main contract, you need to be aware of the impact of "expiration roll-over".

• Cash Settlement Contract: You must close your position on or before the last trading day, otherwise you may face a forced system closeout.
• Physical Delivery Contract: Tiger Trade does not support physical delivery, in this case, you need to close your position before the first notice day or the last trading day.

Generally, the transfer can be instantaneous. Under special circumstances, it is expected to take around one business day for approval.

There are many types of futures contracts that you can trade, including commodities, currencies, indices, and interest rate contracts. You can view specific contracts supported in 'Quotes - Futures'.

Contango and backwardation are terms describing the relationship between futures prices and spot prices. If the futures price is higher than the spot price, we say the future is in contango; if the futures price is lower than the spot price, we say the future is in backwardation.

• Contango: This refers to the situation where the futures price is higher than the spot price, also known as "positive basis". Contango may be caused by various factors, such as the expectation of future supply and demand relations pushing spot prices, or holding costs (such as storage, insurance, and interest) added to the spot price.
• Backwardation: This refers to the situation where the futures price is lower than the spot price, also known as "negative basis". Backwardation usually occurs when the market has a lower expectation of future spot prices, or when a futures contract is nearing delivery. Please note, the state of contango or backwardation does not presage market trends but reflects the market participants' expectations of future prices.
  Please note that the status of premium and premium does not indicate the market trend, but the expectation of market participants for future prices.

Currently, Tiger Trade does not support futures trading on weekends.

You can see your futures positions in Tiger Trade - Positions - Futures.

There may be many reasons why you can't trade certain futures contracts, including but not limited to your account type, account balance, contract margin requirements, exchange regulations, or that some contracts are not tradable on the Tiger Trade. If you have any questions, it's recommended to contact customer service.

Futures trading is inherently a margin trading system, and therefore no additional financing or leverage can be used.
Futures contracts are traded in the form of margins. Users only need an initial margin that is a certain percentage of the contract value (usually around 10%, but the margin ratio is less than 50%) to trade. The exchange settles the users' position contracts once a day. Users whose margin amounts do not meet the requirements are required to provide additional margin. Tiger Brokers may require a higher margin for overnight contracts.

Futures trading involves high risks, and investors should consider their own risk tolerance. Before trading futures, it is recommended that you thoroughly research and consider using the futures investment information and learning materials provided by Tiger Trade. You can also familiarize yourself with the trading rules through Tiger Trade's futures demo account.

Fees will be charged for both opening and closing futures contracts. These fees include Tiger commissions, platform fees, exchange fees, regulatory fees, and so on. For details, please refer to the Pricing page: https://www.gotigerhk.com/hk/en/commissions/fees/futures. Please note that this page displays the standard fees for one side of a transaction.