Online futures trading platform in South Africa
In today's world, online investing on various trading platforms is becoming increasingly popular. In the past ordinary citizens of South Africa could not even think about investing in the stock market, but now it is becoming quite real and easy for ordinary people. There is no need to go anywhere and travel or make an appointment with a broker, all it takes is a computer at home, a little knowledge in its use and access to the vastness of the Internet.
For online trading special attention should be paid to the choice of a platform, thanks to which you will be able to make various operations on the stock exchange.
This platform should be user-friendly and functional for both experienced and novice traders.
Futures as an asset
Before we look at an online platform for trading futures, let's talk about what a futures is and how it works.
A futures is an agreement that the seller guarantees to deliver the buyer an asset (security, commodity, stock, etc.) at an agreed upon price (in the future, but at the current market price) at a specific date and time.
At first sight such terminology as futures, options, shares, trading can frighten ordinary people. However, it is a very promising and interesting replacement of the simple way of earning on bank deposits.
Futures trading is interesting because of the variety of strategies and liquidity. Let's pay a little attention to it to see if it's complicated or simple enough?
Futures are divided into settlement and delivery futures.
In deliverable futures, the commodity is delivered at a given time and price. In the case of a cash futures there are no physical deliveries, but at the end of the term the profit and loss are recalculated between the parties of the agreement (for example for index futures, interest rates etc.).
The value of a futures contract is not equal to the price of the underlying asset. It involves forecasting the future state of the asset as well as the mood of the traders and the market. Therefore, the price may be higher or lower than the value of the underlying asset.
Online trading in futures is quite a risky investment, but with the right strategy can bring high returns.
It is safe to say that trading in futures is profitable because of:
- High liquidity;
- Large selection of financial instruments for trade in various exchanges around the world;
- A low percentage of commissions, lower than on the stock market.
Depending on the investor's goals, the type of instrument and the recommendations of professional brokers, an online futures trading strategy is determined.
A strategy is a plan for determining your style of behavior on the exchange: what assets you will trade, how often you will sell, what will guide your decision-making.
The most popular strategy is risk hedging. The investor sets the price of the underlying asset, thereby protecting himself from adverse price increases or decreases. This type of strategy is actively used by firms to insure profits and by individuals to protect themselves from rate changes.
Arbitrage operations are our next strategy. Their basis is working with spreads. Their essence is that a whole niche arrangement is made, thanks to which investors receive proceeds from the difference in the prices of the same or related assets. Arbitrage can be temporal or spatial. In temporal arbitrage, transactions occur in the same market at different points in time. Spatial arbitrage involves different markets but at the same point in time. This strategy is the most profitable for a beginner: the profit and loss are made at the expense of the futures prices difference with minimal risks.
The last strategy is speculative trading. At the expense of liquidity and high leverage, the speculator makes a profit on the difference of the futures buying and selling price. And since the futures are a liquid instrument, the opportunity to win is also great.
Investors are also interested in futures because of the security, i.e. there is no need to pay as much as when buying the asset.
Futures trading software
Beginning investors, in order to begin work with futures it is necessary to understand and master the online trading platforms. Nowadays, all operations can be easily performed just on such platforms.
A trading platform is a computer system developed directly by a brokerage company for the performance of various operations (including buying and selling) on the stock market.
Therefore, it is very important to choose the right online platform for trading futures. It is important to give preference to those platforms that have proved to be reliable and feature-rich. It is also recommended to highlight opportunities on trading platforms for novice investors. This can be training lessons, online testing, opening a demo account.
When choosing an online platform for trading futures in South Africa, you need to pay attention to the following criteria:
- clear and accessible registration;
- the ability to open a demo account;
- training video and audio lessons;
- the minimum amount of deposits and withdrawals from the account;
- ease of use of the platform;
- availability of easy-to-use tools for market analysis;
- chats and online support.
It is important that the online platform can be easily adapted to the individual needs of the investor.
What do I need to start working on the platform? How do I start?
First of all, you need to complete a simple registration. To do this, you'll need to go to the website of your chosen brokerage company. Then find the button "registration" on the panel. After that, answer the questions posed by the program, specify the user name, e-mail, and cell phone number. After completing the registration form, confirm our actions on the platform in the usual way - follow the link that comes to your specified e-mail, or with a code that comes to your cell phone. That's all. You are a user of an online futures trading platform in South Africa.
What is a demo account?
Is it worth to open it or start trading with real money?
Once you register on the platform you will be asked to open a Demo account. It will only take a few minutes of your time. Opening such an account is not difficult, even for beginners.
A demo (fully demo) account is a free training account designed for learning the stock market, similar to a real account. So, in other words, we can say that the demo account is virtual money.
Demo account will help you at the beginning of your investment stage to conduct operations in the stock market. On the account you will be given a certain amount of fictitious money. With this amount you will be able to conduct operations on trading financial instruments without any risk or concern. With this kind of training you will get to know the essence of trading operations and familiarize yourself with the platform for online futures trading. You will be able to observe and analyze the peculiarities of the market, see your future prospects on real accounts and test your skills in earning profits. There is no risk of losing your real money, i.e. minimum stress.
All transactions on the online futures trading platform in South Africa are done with electronic accounts. For real money trading real accounts are opened which leads to risks of losing money as well as increasing it. That is why before you start trading we recommend you to study carefully the subject you are interested in and take part in training.
A real account opens when you register on the trading platform. In order to make your account active, you just need to fund it. Basically, the minimum top-up amount is a few dollars. To begin investing, you will need an even smaller amount - from $1. To make a deposit, click "make a deposit". After that you will choose one of the variants of a way of account replenishment. The most popular way to use bank cards or online payment systems. Withdrawal of funds is also not very difficult.
But before you open a real account, it is better to take the necessary training and practice on a demo account.
Improve your skills
Based on the text written above, we can conclude that investing requires constant study of situations and patterns in financial markets, as well as requires constant training. If you learn to analyze and predict the actions on the stock market, you can earn good money trading stocks, currencies and other assets. It is important to put this knowledge into practice. There are a lot of training lessons and classes on the trading platform, which will allow you to grow as a trader. After training you will master the main trading tactics and learn how to analyze the market.
The specificity of trading is that he who has more knowledge can succeed.
Competent use of assets (futures) in investing can bring good income and minimize risks. It is possible to realize various financial goals, such as to buy a house, to save for retirement, to provide our children with a decent education and future, etc. And just the presence of passive income in our lives.