Tiger Brokers

Futures contracts are legally binding agreements between a buyer and seller to purchase or sell a specific commodity or asset at a predetermined price in the future.

Buying or selling a futures contract means you agree to buy or sell a specific quantity of a commodity or financial instrument at a specified price, and the settlement time depends on the settlement date of the contract you are trading. It should be noted that Tiger Brokers currently does not support Physical Delivery, therefore physically deliverable contracts need to be closed before the first notice date or the last trading day (whichever comes first). Non-physical (or non deliverable) contracts may be closed before the last trading day or the system will settle them with cash.

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 are highly leveraged as you control the full notional value of the contract but pay only a proportion of the value as margin, thereby improving the efficiency of capital utilisation. Thirdly, futures allow investors to manage expectations by locking in future prices to hedge market fluctuations. Finally, futures trading allows buying and selling (going long or short), allowing profits to be made from the underlying asset increasing or decreasing in price.

However, futures trading also carries significant 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 unfavourable.

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 Profile'
Desktop: 'Quotes - Futures' - select a contract - 'Contract Profile'

Each futures contract has a specific expiration date, thereafter it is no longer tradable. In general, the product lifespan lasts for a 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 "continuous" can be interpreted as "connecting" the market price of each most active trading contract together. 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 may close your position on or before the last trading day, otherwise the system will settle them with cash.
• 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.

Currently, Tiger Trade does not support futures trading on weekends as futures exchanges (like stock exchanges) are closed during the weekends. Please check the trading hours of the contract you wish to trade.

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 on margin. Users only need an initial margin that is a certain percentage of the contract value (usually around 10%, but the margin ratio can be up to 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 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.

"Futures trading is inherently a margin trading system, and therefore no additional financing or leverage can be used. 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 /sg/commissions/fees/futures.html. Please note that this page displays the standard fees for one side of a transaction.