Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd. You should consider whether you understand how CFDs or our other products work and whether you can afford to take the high risk of losing your money.

FAQ

Find answers to the most popular questions regarding trading with Tickmill.

Trading Conditions

If you have a position and would like to continue holding without closing, you can roll the contract into the next expiry month. This is done by opening the spread function in the trading platform and placing an order to sell the expiry. Then you buy the next expiry available of your choice (generally the next exiry month). Once executed you will have closed your position and will have your new expiry month contract.


The lot size represents the standardized number of a financial instrument as set out by the exchange. When trading Futures, the lot size refers to the total number of contracts contained in one contract. Exchange traded Futures are standardised so they could have 100 shares or 1,000 barrels of Oil in one futures contract. You will find this information on the Contract specifications page.


Level 1 provides access to live 'top of book' prices (Best Bid and Best Ask). Level 2 or 'Market Depth Data' gives you access to the same real-time prices as Level 1 but also real-time market depth The 2nd, 3rd, 4th best bid and ask and so on. No data will be available until you make Market data choices when selecting your CQG platform.


There are 2 main ways to close a futures position:

  1. Offsetting the position is the simplest and most common way. If you have bought one lot you simply sell one lot. This will net your position to Zero.
  2. Roll the position into the next contract month if you don't wish to give up your exposure when the current contract expires.

During times where there is high volatility in the market there will be larger margin requirements, while lower volatility will lead to lower margins. Some of the key factors affecting Futures are supply/demand shifts (fundamentals), changes in fiscal policy (spending/taxation), major geopolitical events and natural disasters.


All exchanges or clearing houses publish specific futures expiration date calendars, which specify the exact expiration dates for each of their futures products. Usually this is done on the third Friday of every contract month (Expiration Month) available.


A futures exchange is a central financial exchange where people can trade standardized futures contracts. They can buy specific quantities of a commodity or financial instrument at a specified price, with delivery set at a specified time in the future.


A clearing house is a financial institution formed to facilitate the exchange of payments, securities, or derivative transactions. The clearing house stands between two clearing firms. Its purpose is to reduce the risk of a member firm failing to honor its trade settlement obligations.


'Open Interest' is the total number of futures contracts held by market participants at the end of the trading day. It's used as an indicator to determine market sentiment and the strength behind price trends.


The 'Trading Volume' is the number of contracts that have been bought and sold over a given time. When a futures contract is traded, whether bought or sold, it counts towards the trading volume for that contract. For example a person sells a S&P500 futures contract then that counts as 1 lot.


In very simple terms the Initial margin is the amount the exchange requires from its members before a contract is opened. It can be considered similar to a non-refundable security deposit. A maintenance margin is the amount the exchange expects you not to fall below to 'maintain' the position. In which case you either deposit further funds to secure the position or it will be closed out due to the lack of funds. This is to protect the client and the broker and ultimately the exchange who guarantee the settlement of every trade.


Tickmill has standard commission rates for Futures traders which you can see by clicking here. We also understand the standard commission rate is not suitable for all traders so please contact us to discuss a tailor made solution on [email protected]