Asx Futures, also known as Australian Securities Exchange Futures, is a platform that allows investors to trade contracts for difference (CFDs) on various assets, including commodities, shares, and currencies. This article will provide an overview of Asx Futures and explain how it can be used by investors.
What is Asx Futures?
Asx Futures is part of the Australian Securities Exchange (ASX), which is one of the world's largest stock exchanges. It provides a trading platform where investors can buy and sell derivatives on stocks, shares, bonds, and other financial instruments.
The key features of Asx Futures include:
• Flexibility: Investors can choose from a wide range of assets, including gold, silver, oil, and natural gas. They can also use CFDs to trade on futures contracts, which offer more flexibility than traditional spot contracts.
• Low margin requirements: Compared to traditional equities, investors do not need to maintain a large margin account when using Asx Futures. This makes it easier for beginners to get started with investing.
• Higher leverage: With Asx Futures, investors can trade larger amounts with less money, thanks to higher leverage. This can increase their potential returns but also increases their risk.
• High liquidity: Asx Futures offers high liquidity, meaning that there are many buyers and sellers of the underlying asset at any given time.
How to Trade on Asx Futures
To trade on Asx Futures, investors first need to open a trading account with an accredited broker. Brokers like IG, ThinkForex, or Xforex are popular choices for traders looking to invest in Asx Futures.
Once they have opened an account, investors can start placing trades on Asx Futures. To place a trade, they need to select the type of contract they want to trade, such as a futures contract or a CFD. They then specify the quantity of the asset they wish to trade and enter the price they expect it to reach.
Traders must also pay a commission fee each time they make a trade. The commission varies depending on the asset and the size of the trade. For example, commissions for buying gold futures can range from $10-$50 per lot, while commissions for trading share CFDs can vary between 0.1-0.2%.
Benefits of Trading on Asx Futures
Trading on Asx Futures has several benefits, including:
• Lower cost: Compared to traditional equities, Asx Futures typically charge lower fees, making them a more affordable option for investors.
• Greater flexibility: Asx Futures allow investors to trade on multiple assets simultaneously, providing greater flexibility in their investment strategy.
• More liquidity: The high liquidity of Asx Futures means that there are many buyers and sellers available at any given time, allowing investors to take advantage of market movements quickly.
Examples of Asx Futures Contracts
Asx Futures offers a wide variety of contracts, including futures contracts on gold, silver, oil, and natural gas. These contracts are traded on both the ASX and the London Metal Exchange (LME).
For instance, investors can buy or sell gold futures on the LME, which are similar to futures contracts on gold mined in Australia. Similarly, they can trade on the ASX futures contracts, which track prices of gold mining companies in Australia.
Another example is trading on oil futures, which tracks prices of crude oil extracted in Saudi Arabia, Venezuela, and Nigeria. Investors can also trade on CFDs on natural gas, which tracks prices of natural gas produced in the United States.
Conclusion
In conclusion, Asx Futures is a powerful tool for investors who want to trade on a variety of assets. Its low-cost, flexible nature, and high liquidity make it a great choice for those seeking a more affordable and accessible way to invest in the global market. However, as with any form of investment, it's important to conduct thorough research before trading on Asx Futures.
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