What it Means to Canadians

Next to foreign exchange currency trading, futures trading is one of the most active and lucrative investment markets in the world. Today, the Canadian dollar is almost nearing the value of the US dollar and despite the credit crisis that the country experiences, the futures market is still deemed to be a worthwhile investment.

In futures trading, there is typically a standardized contract which indicates the obligation of the two parties involved to buy or sell a contract. The term 'futures' signifies that the delivery of the item or instrument is to be on a future date, rather than the present. If you want to immerse yourself in the lucrative Canadian futures market, there are a few steps that you need to follow.

First, you need to open an account with a reliable broker who will handle the futures trading for you. As a trader, you will gain immediate access to the futures market as soon as your account is funded. The good thing about this type of investment vehicle is that you only need a small amount of money to get started, unlike stock investments which usually require thousands of dollars.

After your account is opened and funded, you can start placing a trade. There are a few industry-specific terms that you need to know about to get started in futures trading. Placing a market order means that the broker will immediately buy or sell a futures contract for you at the going market price. A stop order is placed to limit your losses on a position in the market. Finally, there is the limit order which instructs the broker to buy or sell a futures contract at a specific market price. Remember that in Canadian futures trading, you can always start small and work your way up as your expertise in trading grows. Make sure that the broker that you will do business with can assist you and address all of your concerns efficiently so that your experience in futures trading will be a good – and profitable one.