By buying and selling futures online – you are entering a trading space that is largely dominated by institutional investors. This is because futures require a much larger minimum capital outlay in comparison to traditional financial instruments. Plus. many futures contracts are settled in the underlying asset – such as oil or wheat.
Nevertheless, if you’re a retail client that wishes to access this marketplace – this guide reviews the best futures trading platforms for 2021. We also explain how futures trading works and how you can get started with your first investment today!
Your capital is at risk.
In This Guide
In searching long and hard for the best futures trading platform in the market right now – we like the providers listed below. For full futures trading platform reviews – scroll down.
There are many factors that you need to consider in your search for the best futures trading platform for your needs. For example, the broker needs to support your chosen futures market – whether that’s stocks, commodities, or even cryptocurrencies. Then, you need to look at what the minimum trade size is and what fees the futures broker charges.
To help clear the mist, below you will find the best futures brokers that are active in 2021.
If you’re a complete newbie and fall within the retail client bracket – then eToro is going to be the best broker to trade futures for you. This is because the online broker is aimed at the ‘average’ investor that wishes to buy and sell assets for the first time.
On top of stocks, indices, commodities, ETFs, forex, and cryptocurrencies – eToro also offers a good number of futures trading markets. In particular, the broker is particularly strong when it comes to crude oil futures. For example, there are oil futures markets with 10 different expiry dates. Each and every futures market offered by eToro comes in the shape of CFDs.
This means that you do not own the actual futures contract and the underlying asset does not exist. This option makes it the best futures broker for beginners with little experience in this space – as there is concern about actually needing to buy the asset – should you hold the contracts when they expire.
Additionally, by trading futures CFDs at eToro you will be able to apply leverage. In most cases, this stands at 1:10 when trading commodity futures on the platform. Best of all – unlike other trading platforms in this space – eToro doesn’t charge any commissions when you buy and sell futures. The spreads on offer are very competitive, too.
eToro is best known as a social trading platform that allows you to engage with millions of other users. It also offers innovative copy trading tools that allow you to copy top futures traders at the click of a button. Best of all, you don’t need to pay any extra fees for eToro’s copy trading platform features.
Perhaps the main drawback with eToro is that the broker only allows US citizens to buy and sell digital currencies. As such, if you’re an American trader, you’ll want to consider one of the other top-rated futures trading brokers we discuss on this page. Nevertheless, getting started at eToro takes minutes and you can deposit funds with a variety of convenient payment methods.
This includes a debit card, credit card, bank transfer, and e-wallets such as Paypal, Neteller, and Skrill. In terms of reputation, eToro is now home to over 20 million clients. The broker is regulated on three fronts – with licenses from the FCA, CySEC, and ASIC. For US clients looking to buy and sell crypto – eToro is registered with FINRA.
Interactive Brokers is an established online trading platform that not only supports US clients - but residents of many other countries. This futures trading platform is without a doubt the best option on the table if you are a seasoned pro.
First and foremost, Interactive Brokers gives you access to a huge library of futures markets across 35 different global exchanges. In the US, This includes 8 different exchanges - such as the CBOE, CME, ICE Futures, New York Mercantile Exchange, and OneChicago.
Outside of the US, Interactive Brokers also allows you to buy and sell futures from the UK, Europe, Canada, Mexico, Asia, and Australia. Best of all, you can trade virtually every futures market imaginable. This includes futures linked to stocks, oil, natural gas, agricultural products (e.g. wheat and corn), and more.
When it comes to fees, Interactive Brokers does have somewhat of a complex pricing structure. This is because the fees you pay will not only depend on the exchange you are looking to access but also the account type you are on. Nevertheless, if you are looking to trade futures on the E-Mini S&P 500, this will cost you just $0.85 per contract.
Interactive Brokers fees
In a similar nature to eToro, Libertex is a popular online broker that allows you to access traditional futures markets via CFDs. Once again, this is ideal for retail clients as it means that you can trade with small amounts and you don't need to worry about settling the futures contract in the underlying asset.
In terms of supported markets, this CFD trading platform covers a good range of commodities. In the oil department, this includes markets on WTI Crude, Brent crude, Light Sweet Crude, and Heating Oil.
You also have markets on Henry Hub Natural Gas, wheat, corn, and many other agricultural products. You can also trade indices, stocks, ETFs, forex, and more. As you are trading CFDs as opposed to conventional futures contracts - markets never expire. This gives you much more in the way of flexibility.
All markets on Libertex can also be traded with leverage - with limits depending on the asset, your location, and whether you are a retail or professional client. When it comes to fees - this is where Libertex really stands out. Firstly, the day trading platform does not charge any spreads - so the bid and ask price on all markets are like-for-like.
Secondly, commissions are either at or close to 0%. For example, Brent Crude and WTI Crude markets come with a commission of just 0.169 % and 0.132%, respectively. The likes of wheat and soybean are also competitive with low commissions of just 0.117% and 0.0160%.
If you want to get started with Libertex today - you'll be joining almost 3 million other clients. The broker - which was launched over two decades ago, allows you to deposit from just $100 upwards. You can do this with a debit card, credit card, e-wallet, or bank wire. After your first deposit, the minimum funding amount goes down to just $10.
83% of retail investors lose money trading CFDs at this site.
If you're a retail client based in the US - then the best futures trading platform for you could be TradeStation. This popular online broker offers everything from stocks, bonds, ETFs, and mutual funds to cryptocurrencies, options, and futures.
Regarding its futures trading marketplace - this covers over 350 different instruments. This includes index futures such as the E-mini S&P 500 and currencies like the British pound and Japanese yen.
Futures markets on interest rates are also supported - with popular instruments including both 5-year and 10-year US Treasury Notes. And of course, TradeStation also offers an abundance of futures markets in the commodity department. This covers everything from gold, silver, oil, and natural gas to coffee, cotton, wheat, and live cattle.
What we really like about TradeStation is that it is suitable for those of you with a small amount of capital. This fact also makes the platform to be considered in the survey for the best trading platform for e mini futures - the minimum margin amount required is just $175. In addition to this, TradeStation also offers some very competitive trading fees. This starts at just $1.50 per futures contract.
Your capital Is at risk.
If you are looking for the cheapest futures broker to access the global futures trading scene - Plus500 is a good option. The platform specializes exclusively in CFDs -making it perfect for those of you seeking a low-cost entrance to this marketplace.
This is because Plus500 does not charge any trading commissions. Instead, it's only the spread that you need to factor into your futures trading costs. In terms of supported markets, Plus500 is very strong in two key areas - indices and commodities.
Regarding the former, this includes CFD futures on the likes of the NASDAQ 100, S&P 500, and the Dow Jones. Plus500 CFD futures do come with an expiry date, albeit, your position is settled at the current market price. This means that you are speculating on the future price of the contracts - so there is no need to buy or sell the asset upon maturity.
In the case of commodities - Plus500 offers a huge library of hard metals, energies, and agricultural products. Plus500 is also a good option if you want to trade CFD futures with leverage. Although your limits will be determined by your residency and the respective asset - this does go as high as 1:300 for some retail client locations.
Plus500 doesn't support third-party platforms like MT4 - so you can trade CFD futures directly in your web browser. The platform also offers a top-rated mobile app that is available on iOS and Android devices. The minimum deposit at this heavily regulated broker is just $100 and you can choose from a debit/credit card, Paypal, or bank transfer.
72% of retail CFD accounts lose money.
If you're an experienced futures trader that knows your way around an advanced platform - then TD Ameritrade is well worth considering. This age-old brokerage firm gives you access to over 70 futures trading markets - which cover a wide variety of assets.
For example, you can trade agricultural products like corn, oats, feeder cattle, and lumber - as well as energies and hard metals. There are futures markets on many stock market indices too - covering the likes of the Dow Jones, S&P 600, NASDAQ 100, Russell 2000, and Nikkei 225.
Other futures markets on TD Ameritrade include interest rates and currencies. As a seasoned trader, you will likely find the thinkorswim platform super-useful. Native to TD Ameritrade, this platform comes packed with advanced trading tools, technical indicators, and order types.
The thinkorswim platform is also accessible via a mobile app - which is available on both Android and iOS devices. In terms of fees, TD Ameritrade charges $2.25 per futures contract. This is slightly more expensive than the futures fees charged by Interactive Brokers and TradeStation, you can also see this when compared to Fidelity in our Fidelity vs TD Ameritrade review.
But, TD Ameritrade does allow you to buy US-listed stocks and ETFs on a commission-free basis - should you wish to access these instruments. Finally, if you're also interested in trading options, TD Ameritrade offers heaps of markets. Prices are competitive at just $0.65 per options contract.
TD Ameritrade fees
Make no mistake about it - financial derivatives like futures and options are a lot more complex than traditional assets. Crucially, you can lose more money than you had initially planned for when trading futures - as you are entering into a contract with your chosen broker.
With this in mind, we would suggest reading through the following sections to ensure you understand how futures work.
As the name suggests, by trading futures you are speculating on the future price of an asset. This might be a market on stocks, oil, natural gas, interest rates, or even Bitcoin. Either way, the objective is to predict whether the price of the financial instrument will be higher or lower when the contracts expire - which is typically three months.
This means that you can trade the asset in question in a much more flexible way, as you have the option of going long or short. The best broker for futures also allows you to apply leverage. This is important, as the minimum trade size in the futures industry is often very high.
Here's an example of a futures trade to help clear the mist:
1 futures contract on Brent Crude oil amounts to 1,000 barrels - meaning the minimum order value is $50,000. Fortunately, your chosen futures trading broker offers leverage of 1:100 - so you only need to outlay $500.
As you can see from the above, there is no requirement to hold on to your futures contracts until they expire. In fact, doing this is high-risk, as you might be liable to buy the underlying asset if you are still holding the contracts upon maturity.
You will also notice from the above example that each Brent Crude oil contract contains 1,000 barrels. This once again illustrates that futures trading is best reserved for institutional investors or those with lots of trading experience. If you're a newbie, futures in the form of CFDs are much more suitable.
As we covered in our mini-reviews of the best futures brokers for 2021 - there are many markets that you can trade.
As you can see, there are futures trading markets available on a wide variety of asset classes. You do, however, need to check what the minimum trade size is and how many instruments are contained within each contract. And even more importantly - you need to check what your liability is in the event you are still holding the contracts once they expire.
There are many reasons why you might consider trading a complex financial instrument like futures. In many cases, this is because you will have access to a broader set of markets, the ability to go long or short, and be able to trade on margin.
Let's explore these key benefits in more detail:
As we have noted throughout this guide, futures are available on dozens of financial markets. In particular, 'hard assets' like gold, oil, natural gas, and wheat would otherwise be difficult to speculate on without the availability of a futures contract.
After all, you would be required to personally purchase, store, and transport gold bullion bars or barrels of oil. But, by making use of a futures trading broker, all you need to do is speculate whether you think the price of the asset will rise or fall. This means that you can trade heaps of assets from the comfort of your home.
When you use a traditional stock trading platform - you can only purchase shares in the hope that they rise in value. This is also the case with other asset classes. However, by using a top-rated futures trading broker - you will always have the option of going long or short.
The latter means that you are speculating on the price of the asset falling. For example, you might be looking at gold and think that it is overvalued. If so, all you need to do is short-sell a futures contract.
We mentioned earlier that futures contracts will contain a large number of individual financial instruments. For example, in the case of oil futures, a single contract will contain 1,000 barrels. This means that ordinarily, you are required to outlay tens of thousands of dollars to access the market.
Fortunately, the best futures trading brokers allow you to buy and sell contracts on margin. For those unaware, this means that you are only required to put a small amount of money upfront to enter the market. The amount of margin you have available will depend on several factors - such as whether you are a professional or retail client, the asset class, and where you are located.
But, in many instances, you might be able to get up to 1:100 - sometimes more. For example, if the minimum trade size required is $100,000 - at 1:100 this would require an outlay of just $1,000.
The futures trading scene operates much like the traditional stock exchange. That is to say, most trading is conducted during standard market hours - Monday to Friday. With that said - and much like conventional stocks, it is also possible to trade futures outside of standard market hours. Each futures exchange will, however, have its own rules surrounding tradable hours.
For example, in the US, most exchanges allow you to trade futures from 5 pm (Central Time) on Sunday through to 4 pm on Friday. On the other hand, futures markets in the UK take a more traditional approach - choosing to close their doors over the weekend.
It is important to have a strategy in place when trading futures. After all, futures are complex financial derivatives that offer a much higher risk/reward potential than conventional assets.
If you are completely new to the futures trading scene - consider some of the strategies discussed below.
Hedging is a crucial tool when you are invested in the financial markets. For those unaware, hedging simply refers to the process of 'covering your bets' in the event the markets turn against you.
In other words, instead of cashing out your position in fear of a market reversal, you can keep your investments open through a hedging strategy. And, there is no better way of achieving this goal than through a futures contract.
Here's an example of how this futures trading strategy works:
At this point, you now have two contrasting positions. That is to say, you are 'long' on gold through your initial investment and 'short' via your futures contracts.
Let's see how the hedging strategy might pan out.
As you can see from the above, by hedging your position through a futures contract, you can cover your exposure to a sudden market downturn.
If you are looking for a way to capitalize on market corrections, futures are an excellent financial instrument to achieve this goal. For those unaware, a market correction or 'pullback' is when an asset temporarily goes through a downward price movement.
This could be for a number of reasons, such as:
Irrespective of the reason, the market correction is a temporary pullback, meaning that the upwards trend is expected to resume in the coming days or weeks.
If this is the case, then you can go long on a futures contract at a much more favorable price. This is because futures prices are determined by market forces - meaning that when the underlying asset goes down in value, so does the price of the contract.
If you are sure that futures trading is right for you and your financial goals and wish to get started right now - follow the walkthrough outlined below. For this, we are going to show you how to open an account and place your first futures trade with commission-free broker eToro.
As a regulated broker eToro will ask you to open an account and upload some ID. First, head over to the eToro homepage and click on 'Join Now'. Then, you will be prompted to enter some personal information and contact details.
75% of retail investor accounts lose money when trading CFDs with this provider.
Once you have opened your account, you will need to upload a copy of your:
eToro is usually able to verify your documents instantly via automated KYC software.
If you want to initially trade futures in a risk-free environment, you can switch your eToro account to 'Demo Mode'. This means that you can buy, sell, and trade futures contracts with a paper trading balance of $100,000.
If, however, you want to start trading futures with real money at real-time, you'll first need to make a deposit. eToro supports the following payment methods:
Unless you are depositing in US dollars, there is an FX fee of 0.5% on all payment methods.
Once you have made a deposit, you can then search for your chosen futures trading market. You can do this by clicking on the 'Trade Markets' button followed by your chosen asset class.
If you already know which market you wish to trade, search for it.
In our example, we looking to trade oil futures with an expiry of May 2021. To do this, we need to set up an order.
Firstly, choose from a long or short position by selecting a 'buy order' or 'sell order', respectively. Then, enter your stake and your chosen leverage ratio (if applicable).
As per the above, we are staking $100 with leverage of 10x on a sell order. This means that should the futures expire in May 2021 at less than $64.76 per barrel - we make a profit.
Finally, click on the 'Open Trade' button to place your futures position.
In summary, choosing the right commodity trading platforms for your needs is crucial. Not only does the provider need to support your preferred instrument - such as CFDs or futures, but also the specific market, like gold, silver, or natural gas.
And of course, the commodity broker needs to be regulated by the appropriate bodies and offer low fees and commissions.
In our view, eToro is the best futures trading platform to consider in 2021. You will have access to over 45 commodity markets on a commission-free basis. The regulated broker also offers a Copy Trading feature, leverage, and heaps of payment methods.
The main concept with futures trading is that you need to speculate on whether you think the asset will be worth more or less when contracts expire. For example, if you are trading 3-month oil futures that are currently priced at $65, you need to decide whether you think the price of the asset will be more or less than $65 per barrel in 3 months' time. If you speculate correctly - you make money.
There are many similarities between futures and options. For example, both markets come with an expiry date that typically sits at the 3-month area, and they both allow you to apply leverage and short-sell. However, the key difference is that options give you the 'right' to buy or sell the asset on expiry, and not the 'obligation' like you get with futures. Additionally, options only require an upfront deposit to access the market - which is known as the 'premium'. In the case of futures, you need to put the full amount upfront, unless you trade with leverage.
The Bitcoin futures scene has been active since late 2017. However, this is mainly geared towards institutional investors. The good news is that retail clients can trade Bitcoin futures via CFDs.
If you are a complete newbie and wish to trade futures, commission-free broker eToro is a great option. However, eToro doesn't offer futures to US citizens, so if you're an American, the likes of Interactive Brokers and TradeStation are worth considering.
There is no one size fits all answer to this question. After all, the amount of money that you can make from futures trading depends on how much you stake and how successful your predictions are.
Although this will vary from asset to asset, futures contracts are often worth tens of thousands of dollars. For example, there are 1,000 barrels in a single oil futures contract. So, at $65 per barrel, that's $65,000 per contract. Stocks, on the other hand, usually have 100 shares per futures contract. This can still be sizable, as many US stocks are worth hundreds of dollars each.
The most commonly traded futures markets include commodities and indices. However, you can also trade futures on stocks, interest rates, Bitcoin, currencies, and more.
Kane Pepi is a British researcher and writer that specializes in finance, financial crime, and blockchain technology. Now based in Malta, Kane writes for a number of platforms in the online domain. In particular, Kane is skilled at explaining complex financial subjects in a user-friendly manner. Kane has also written for websites such as MoneyCheck, InsideBitcoins, Blockonomi, Learnbonds, Buysharesand the Malta Association of Compliance Officers.
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