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Stock Futures
Single stock futures quotes
Single Stock Futures investors are a cheaper method of investing in the equity markets and are expected to have a considerable appeal. They denote the most interesting developments in the financial field of derivatives. This is because of their potential in trading, which is large, and the reality is that are recently only considered as legal in the US. Investors are comfortable with SSF and access to trade futures contracts on popular stocks traded on stock exchanges. SSF includes nearly 50-70 actively traded stocks in US such as Pfizer, IBM, Johnson & Johnson, Microsoft, General Electric, and Citigroup, to name some. Besides, investors can trade in the NBI (Narrow Based Indices). NBI refers to small stock groups that concentrate in a particular equities market area such as pharmaceuticals, airlines, automotive and semiconductors. Single stock futures enjoy the privilege of short selling. You can buy and sell a stock easily. When a stock is sold short using an SSF contract, then the need of waiting for an uptick does not arise. You can sell as you wish without undergoing any sort of trouble in finding the stock or paying the interest rate to the broker on the borrowed shares. Selling SSF contracts also contribute to a great risk management in the tax benefits. This can be done by not selling particular stocks during the downturn of the market and instead can sell the same amount of shares in SSF against his stock position that will be as a hedge. This hedging facility of a stock facilitates in holding the underlying position for a longer period of time and thereby providing the investors considerable tax savings. Speculation without owning any stock can be done using SSF anticipating the increase or downfall in the stock price. SSF trading is done in 100 share blocks, practically noticing the price movement of the single stock that is based on the futures contract. In SSF, you require nearly 20% or even less than half the margin in the stock market, and there is no interest charge on selling or buying a stock on margin. Thereby, you may lose or earn the same in SSF contract as you would do if you buy 100 shares of stock. However, the transaction costs are lesser. The facility of spread differentials is a great advantage in SSF contract. This is helpful because when an investor foresees the decline or rise in another stock, he can buy a SF contract on one and sell the SSF contract on the other with the aim of earning profit through the spread differential technique. There is no doubt that SSF has greater versatility. SSF is traded on the internet and this facilitates the investors as thy get all the information, speed of execution and delivery.
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