Understanding futures trading is complicated. That much, most people can agree with, right?
Best Online Futures Brokers:
- Best for Advanced Traders: NinjaTrader
- Best Membership: Tradovate
- Best for Usability: TradeStation
- Best for More Futures Options: E*Trade
- Best for High Volume Traders: Discount Trading
- Best for Professional Traders: Interactive Brokers
- Best for Active Traders: Lightspeed
- Best Mobile Platform: TD Ameritrade
- Best for Education: Charles Schwab
- Best for Low Commissions: Generic Trade
Here’s an interesting history lesson. Futures trading history is as simple as understanding the concept of farmers planting crops every spring, and then, every fall, farmers harvesting grain and locking in prices early in the season, rather than later. In fact, farmers were originally the ones who taught Wall Street how to trade futures. (No lie!)
In choosing a broker, serious futures traders have the unenviable task of carefully balancing a conglomeration of requirements: low commissions, intuitive platforms, excellent customer service, up-to-date research options, not to mention charting and screening tools that must rock their world.
In a world where futures trading is already a high-risk endeavor, it’s even more of a risk if a platform is clunky, a trading app can’t keep up, or customer support has no idea what a Fibonacci indicator is. Everything must tick along as smoothly as a Rolex Cellini tracks the seconds in a day. Here are Benzinga’s suggestions for the best brokers for futures trading.
NinjaTrader has an amazing trading platform for those just beginning their trading careers as well as for advanced traders. Their extensive collection of technical analysis tools is perfect for beginners utilizing a demo account, and they even offer a two-week free trial when you register.
If you want to use NinjaTraders software, you can get it for free when you fund a brokerage account or you can lease the software. You will get access to charts, simulated trading, and market analysis, the essentials for futures trading, even if you get the software for free.
NinjaTrader won the 2016 True Edge Futures Broker of the Year Gold Award and has the only platform powerful enough to run the Diversified Trading System. In addition, NinjaTrader offers extensive data feed options, flexible interface and free demonstration options.
The minimum opening balance is $400 and commissions start at $0.09. Futures traders can get the lowest NinjaTrader commissions by acquiring a platform lifetime license. In addition, the margin requirement is $500 per contract.
Are you an active futures trader? Look no further than Tradovate. Tradovate offers a Netflix-like approach to commission-free trading and cloud-based solutions. You’ll get an integrated experience you can carry seamlessly across any device whenever you want it.
Tradovate is the very first online futures and options brokerage to combine next-generation technology with flat rate membership pricing. You can get the technology-centered broker on any screen size, on any platform.
Tradovate delivers a seamless futures trading experience by offering:
- One place to fill all your needs
- A pricing model that saves you money over the traditional commission model
- Improves the customer experience
- Gets rid of fragmentation (other offerings require you to go through a software provider, then find a brokerage, then find an FCM) — which adds costs
TradeStation offers 2 distinct account types: its basic TS GO account aimed at new trades and its more in-depth TS Select account aimed at more advanced traders looking for a comprehensive set of tools and research options. There’s no minimum account balance required to open a TS GO account. TS Select accounts require a $2,000 minimum deposit.
Signing up for an account with TradeStation is intuitive and simple. You’ll begin by choosing the type of account you want, entering a little personal information, answering a few questions about your experience level and agreeing to the company’s terms of service. A TradeStation representative will review your application and open your account. As soon as your account is open you can begin funding your account and making trades.
One area where TradeStation excels is in education. Though it was originally aimed at professional investors, TradeStation now offers a wealth of education options that brand new traders can understand and use.
E-Trade offers over 200 futures products, and that’s why we’ve put it in the category of myriad options available to investors. In addition, if you’d like to trade futures with E-Trade, it will cost you $1.50 per contract. E-Trade is no stranger to pro-level tools and top-notch platforms.
You’ll feel right at home with research capabilities, too: E-Trade Futures Research Center is powered by the CME Group—one of the world’s largest futures exchanges. Whether you’re into metals, currencies or more, E-Trade can offer a multitude of options for you.
One strike against E-Trade is that you’ll need at least $500 for the minimum opening balance, a hefty amount compared to other investment companies.
5. Discount Trading
Futures traders looking for volume discounts have plenty of options, but few make trading as simple and affordable as Discount Trading. For starters, Discount Trading doesn’t just offer affordable commissions – they have some of the cheapest trading fees of any futures broker currently on the market!
If you make only a single futures trade each month, your commission will be a mere 49 cents per side. However, if you’re an active trader flipping more than 50,000 contracts per month, your commission will be a measly 19 cents.
Additionally, Discount Trading offers a variety of trading platforms for investors of all skill levels. Amongst these platforms is FireTip, a simple but effective trading platform that provides live quotes, market alerts, real-time news, and a live chat feature for customer assistance.
While many brokers charge fees for streaming quotes and live data, FireTip BASIC is available to Discount Trading clients for absolutely nothing. Discount Trading offers something for everyone, from novice traders all the way up to the experts flipping S&P E-minis and soybean contracts. Also, demo accounts are available for FireTip if you want to give the platform a test run first.
6. Interactive Brokers
Interactive Brokers for futures trading offers outstanding, competitive fees: Cost is $0.85 for futures and futures options trading, overall, Interactive Brokers offers the lowest margin rates in the industry, between 1.91% to 1.41% (the lowest percentage is for clients with $1 million with Interactive Brokers). They offer a fully configurable trading platform for knowledgeable traders with more than 50 order types.
As for tech offerings, Interactive Brokers features programmable hotkeys and customizable order types; watch lists can have up to 338 columns and are truly customizable. All devices, including iPhone, iPad, Apple Watch and Android smartphones and tablets are supported. Interactive Brokers made our list for best brokerage for online stock trading.
One strike against Interactive Brokers is that to open an account, the minimum deposit is a cumbersome $10,000.
7. TD Ameritrade
TD Ameritrade requires a low account minimum at $1,500 but it’s $2.25 per contract, per side (plus exchange and regulatory fees). TD Ameritrade’s day trade margin is 25% with a $15,000 minimum with virtual trading capabilities and over 60 futures products. With Thinkorswim, there’s no question that entering and executing orders are fast, with many advanced features.
The ThinkBack feature permits users to backtest strategies and TD Ameritrade’s free platform (Thinkorswim), research and data are all excellent. The ThinkBack feature permits users to backtest strategies and TD Ameritrade’s free platform (Thinkorswim), research and data are all excellent.
With its 24/7 phone support and free seminars and online education, the technical and mobile options make TD Ameritrade worth checking into. TD Ameritrade made our list for best brokerage for online stock trading, and for beginners.
One strike against TD Ameritrade is that its high commissions are not ideal for traders searching for a bargain.
Lightspeed Trading offers volume discounts for frequent traders, low pay-per share commissions, direct access to ECNs and exchanges, and traders are also allowed a free practice account.
It’s a reasonable $0.25-$0.60 per contract with no base charge at Lightspeed trading and a monthly software fee of $100 for Lightspeed Trader, $130 for Sterling, $275 for RealTick Pro and $0 for WebTrader.
One strike against Lightspeed Trading is that it’s really only for traders who trade on daily basis and have at least $10,000 for the minimum opening balance.
9. Charles Schwab
Charles Schwab’s name seems to be synonymous with the word “education,” and that’s no surprise once you land on Schwab’s web page. After all, “Investment Advice” is a bold, clickable heading directly on the home page. If you’re a futures trader, Schwab Trading Insights will help you, and there’s a plethora of opportunities to learn more on Schwab’s active trader futures section.
The investment research opportunities through Schwab are also excellent. Customers have access to free stock reports from S&P Capital IQ, Thomson Reuters, Credit Suisse, and more. You can also access Schwab’s Equity Ratings, which cover approximately 3,000 U.S. stocks and grade them on an A, B, C, D, and F scale.
One strike against Charles Schwab is that the firm’s margin rates are notably high.
10. Generic Trade
Generic Trade has some of the lowest commission fees of any futures traders at a maximum of $0.59 per trade. Generic Trade prides themselves on transparency and keeps their prices lower than other futures brokers by eliminating the need for salespeople and brokers.
The firm believes modern traders already have such a wealth of information at their disposal they mainly need a firm to execute their trades at the lowest cost. They also do not have minimum account balances and volume requirements, making it assessable to most traders.
Finally, Generic Trade boasts some of the lowest latency for executing trades due to advanced technical infrastructure. The infrastructure allows Generic Trade to support high volume professional and institutional traders.
What Matters Most?
Ultimately, depending on the trader, the futures broker characteristic that matters to one trader may matter more or less to another. For example, each trader’s preference on a platform can vary widely; not every trader will agree on what he or she would like to see on a broker’s platform. (Remember, not every painter prefers the same paintbrush, and the same goes for individual traders.
Some don’t need all the bells and whistles.) Perhaps one thing that raises the most red flags are those pesky commissions and margin fees. It might be reckless to choose a broker just because it’s the cheapest, but, boy, is it easy to overpay, and obviously, it’s important to figure out on the front end exactly how much money will eke out during each trade.
And finally, customer service, also highly individualistic (again, some traders don’t care whether they receive good customer service), could make or break an experience with that particular broker.
Summary & Comparison: Best Online Futures Brokers
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