{"product_id":"stcov313fufo2","title":"Stocks \u0026 Commodities V. 31:12 (36): Futures For You by Carley Garner","description":"Futures For You by Carley Garner\u003cbr\u003e\u003cbr\u003eFOREIGN FUTURES\u003cbr\u003e\u003cbr\u003eIm interested in trading foreign futures\nin an account held at a US brokerage\nfirm; what should I be aware of?\u003cbr\u003e\u003cbr\u003eMost US brokerage firms offer their\nclients access to foreign futures and options.\nIf your broker doesnt, you should\nreconsider where you house your commodity\ntrading account. Even if you dont\nintend to trade foreign markets, that they\nare offering you limited product access is\na telltale sign of a brokerage that simply\nisnt equipped to specialize in commodity\ntrading. Perhaps their focus is in stocks\nor FX, but it isnt futures.\u003cbr\u003e\u003cbr\u003eSome of the most popular foreign\nfutures contracts are the German DAX\n(a stock index futures contract), the German\nbunds (sovereign debt futures), and\ncanola oil (a.k.a. rape seed traded on the\nICE Canada exchange).\u003cbr\u003e\u003cbr\u003eTrading in foreign products can complicate\nthe accounting on your brokerage\nstatements because such products are\nnot traded in US dollars, as contracts on\ndomestic exchanges are. Instead, they are\nvalued and traded in the designated currency\nin which the exchange is located. For instance, those buying or selling the\nDAX futures are not making or losing US\ndollars on each trade; instead, they are\naccumulating profits and losses in euros.\nSimilarly, if you buy and sell a canola\nfutures contract, your profit \u0026amp; loss will\nbe calculated in Canadian dollars. In\nother words, upon exit of the position,\nyour account will either be credited or\ndebited in loonies.\u003cbr\u003e\u003cbr\u003eBrokerage firms will typically give you\nthe green light to trade foreign products in\nyour account even though you are holding\nUS dollars on deposit for margin. Once\nyou do, your account will no longer be\nvalued in a single currency. Your brokerage\nstatement will display the current US\ndollar balance along with the balance of\nany other currency resulting from trades\nexecuted in foreign markets.\u003cbr\u003e\u003cbr\u003eFor instance, if a trader started with\n$10,000 and netted a profit of 200 euro on\na DAX trade, his statement would display\n$10,000 and a separate account balance\nof 200 euro. The net is then figured by\nconsidering the current exchange rate\n(typically the 5 pm reading of the spot FX\nprice on the statement date) and displayed\non a third line of the brokerage statement.\nAssuming a value of $1.35 for the euro,\nthe client account statement would read a\ncombined currency balance of $10,270\n($10,000 + (200 euro 1.35)). For simplicity,\nthis example ignores transaction\ncosts associated with the trade.","brand":"store-traders-com","offers":[{"title":"Default Title","offer_id":52134017204593,"sku":"V31C12_666GARN","price":2.95,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0900\/3843\/6209\/files\/unnamed_d2afcada-4869-42f9-9023-654c97fb1024.jpg?v=1739662582","url":"https:\/\/shop.traders.com\/products\/stcov313fufo2","provider":"Stocks \u0026 Commodities","version":"1.0","type":"link"}