Disclaimer: The above information was drawn from sources believed to be reliable. It is not a down payment, and you do not own the underlying commodity. Leverage means the trader does not need the full value of the trade as an account balance. onFormSubmit: function($form){ Every trader needs to have an amount equal to the initial margin requirement in their account balance in order to hold a futures position past the closing time of that market. This practice is often referred to as buying on margin. Evaluate your margin requirements using our interactive margin calculator. Based on the 1% rule, the minimum account balance should, therefore, be at least $5,000, and preferably more. The next section looks at some examples. Accounts that are subject to margin calls may experience higher commissions due to increased risk. Understand how the bond market moved back to its normal trading range, despite historic levels of volatility. Optimus Futures LLC assumes no responsibility for any errors or omissions. Sitemap, A Comprehensive Guide to Futures Trading in 2020, THREE MONTH EURO (EURIBOR) INTEREST RATE FUTURES, THREE MONTH STERLING (SHORT STERLING) INTEREST RATE FUTURES, THREE MONTH EURO SWISS FRANC INTEREST RATE FUTURES. If risking 1% and only trading one contract, you'll need at least $5,000 to $7,500 to start day trading E-mini S&P 500 futures with a four to six tick stop-loss respectively. If your strategy calls for a six tick stop-loss, the risk on the trade is $75 (6 x $12.50). To confirm any item in this schedule, please call the trade desk. Contracts with relatively low liquidity may subject you to additional fees. > US Overnight Session (5:00 pm CST to 8:30 am CST) will be set to 100% Exchange Maintenance Requirements. Should You Hold a Day Trading Position Overnight? E-mini futures, especially the E-mini S&P 500 futures (ES) typically have the lowest day trading margins, $500 with some brokers. To see how much capital is needed for day trading futures (in this case the E-mini S&P 500) we need to understand the contract and the risk it exposes us to. Before even discussing the minimum starting capital for day trading futures, risk management needs to be addressed. Accessed June 18, 2020. Past performance is not indicative of future results. Understanding Futures Margin. If risking a larger amount on each trade, or taking more than one contract, then the account size must be larger to accommodate. We will make our best efforts to contact customers to address margin call depending on the severity of the call. When market conditions and the margin methodology warrant, margin requirements may be reduced. Futures margin: capital requirements. The Balance does not provide tax, investment, or financial services and advice. hbspt.forms.create({ Instead, the broker will make the trader have a margin account. It is not a down payment and you do not own the underlying commodity. The Balance uses cookies to provide you with a great user experience. parameters: { Disclaimer: The above information was drawn from sources believed to be reliable. Futures margin generally represents a smaller percentage of the notional value of the contract, typically 3-12% per futures contract as opposed to up to 50% of the face value of securities purchased on margin. Full Risk Disclosure There is no legal minimum on what balance you must maintain to day trade futures, although you must have enough in the account to cover all day trading margins and fluctuations which result from your positions. Please consult your broker to confirm the current margins for your account. } Click the tabs below to view the day trading margin requirements for the futures trading contracts available for trading from each of our clearing firms. Here's What to Consider, Learning With BBVA Trader: Using Leverage When Trading Stocks, Margin: Borrowing Money to Pay for Stocks, Why Day Traders Should Stick to the 1 Percent Rule (and How to Do It). email: $form[0].elements.email.value, For Eurex markets, day trade rate is valid from 3:00 am ET until session close Monday thru Friday. U.S. Securities and Exchange Commission. Although it is believed that information provided is accurate, no guarantee is made. firstname: "Referral", Minimum Capital Required to Start Day Trading Futures, Futures Brokers, Margin Accounts, and Leverage, What You Need to Know: S&P 500 (ES) Futures Market. Trade Futures 4 Less. If a trader seeks to trade other markets, they will need to check the required day trading margin for that contract and adjust their capital accordingly. portalId: "3635070", Accessed June 18, 2020. Call Now: 800-454-9572 , 310-859-9572 Home (current) This is the amount required to enter into a position per contract on an intraday basis. A stop risking no more than half (in dollar terms) would risk approximately $578. Understanding these differences is essential, prior to trading futures contracts. How Much Money Do Stock Day Traders Make? The information is being presented without consideration of the investment objectives, risk tolerance or financial circumstances of any specific investor and might not be suitable for all investors. These margins are in effect anytime the market is open, except the last 5 minutes of each trading session. "Available Products." This equates to about 12 points, or 12 dollars in the ES index, and that would be the maximum stop allowed. If you are using the Firetip X trading platform, you can find the exchange initial and maintenance margin requirements under the symbol information section.