Stock Market Futures Investment

futures are contracts on commodities, currencies, and stock market indexes that attempt to predict the value of these securities at some date in the future. In the past couple of years, the U.S. stock market has been volatile. But stock futures are one way to hedge your investments so that no single market fluctuation -- way up or­ way down -- will ruin your portfolio.

The best way to understand how stock futures work is to think about them in terms of something tangible. Let's say you own a popcorn company and you need to buy corn to make your product. Every business day, the price of corn goes up and down. You want to buy corn for the lowest price possible so you can make the most profit when you sell your finished product. But you realize that the price of corn today might be very different than it is a year from now. So you enter into a futures contract with a farmer to buy his corn at a specific price on a certain future date. Despite of this you have to follow some Stock Tips from stock advisor for best stock future investment.

For those with the most of their nest egg in individual retirement accounts (IRAs), futures are perhaps the only truly effective means of protecting your assets and preventing a decline in your standard of living. Stock market futures are simple to trade, inexpensive to trade, give you direct exposure and can easily be diversified and also there are many Commodity Tips available for anyone who is interested in commodity trading. Stock market futures trading is definitely an intimidating concept, but that doesn't mean that you can't learn it. There are a lot of nuances to trading stock market futures within your IRA, but nothing that cannot be overcome with several hours of homework. There are two types of futures contracts that are effective in an IRA account -- e-minis and single stock futures (SSFs). E-minis are a fraction of the size of full-size equity index contracts that track the price of an underlying index such as the S&P 500.

Most e-mini contracts are traded on the Chicago Mercantile Exchange (CME). All SSFs are traded on the Chicago One Exchange, and their website lists all the available stock market futures. Your broker will also have a list of all the ticker symbols for each futures contract. While the list is fairly inclusive, many of the contracts will have liquidity issues which I’ll delve into later.