What Are The Best Futures Contracts for Day Trading

Nov 02, 2022 By Triston Martin


Day traders will find opportunities in the futures market to profit. You won't need a lot of money to get started, but if you manage your resources well, you could see significant financial gains. When you day trade, the quantity of capital you need will vary depending on the futures contract you choose to trade. Futures contracts each have their own unique "day trading margin" requirements. This means that you need to have a varied minimum balance in your trading account for different trade contracts.

If you have limited trading capital, your options for futures contracts will be restricted to those with modest day trading margins. Your ability to choose what to trade during the day is increased with a larger account, and the following instructions will assist you in making that choice. When selecting the most profitable futures for trading, one should keep a few aspects in mind.

The Right Trading Platform

Even before you begin your search for the best, you have to be sure that you select the appropriate futures trading platform. Before you choose a specific trading platform, there are a few essential aspects of the market that you need to examine. To begin, it needs to facilitate quick and effective business transactions. The structure of the fees should be understandable and open to public scrutiny, and the commissions should not be excessive. The platform should provide access to various exchanges, feature an intuitive user interface, and be built on top of an advanced technological foundation.

In addition, it should provide you with tools to assist you in analysing the data, provide you with the most recent news, and have features that enable you to make sense of large volumes of trading data quickly and effectively. When it comes to whether you will be making money or losing money when trading in futures, selecting the right platform could make all the difference.

Margin requirement

Before buying a futures contract position for day trading or any other purpose, you must deposit a certain amount of money. Day trading requires a variable amount of capital, the specifics of which are determined by the type of futures contract being traded. Regarding day trading, the margin requirements for feature contracts are different. It is important to keep in mind that the margin requirements for day trading are far smaller than those for overnight trading; nevertheless, to take advantage of this, a trader must liquidate his position before the conclusion of each session.

When it comes to margins, the lower they are, the better, particularly if your account is on the smaller side. On the other hand, having a larger account and margins gives you greater leeway to make decisions. Therefore, the extent to which you can satisfy the margin money requirements significantly affects the characteristics you select. You get more value for your money if the margin needs are kept to a minimum.


When selecting the most profitable futures to trade, an investor should also consider the market's level of liquidity. What exactly is the meaning of "liquidity"? Please take the following scenario as an illustration: you have purchased 50 futures contracts, but when it comes time to sell, you can only find purchasers willing to purchase 10. If this happens, you will be required to sell the futures at a considerably lower price than usual.

The term "slippage" refers to the discrepancy between the planned rate and the lower price at which you ultimately sell your futures contracts. This indicates that the contracts do not have sufficient liquid assets. In this scenario, the costs to enter and leave are both increased. Liquidity is affected by several different elements. One of them is known as the "bid-ask spread," and it can also be described as the amount by which the "ask price" is higher than the "bid price."


There is a significant difference in volatility across different commodities futures. When the market is more volatile, it changes more frequently, which means there are also more opportunities to make profits. When day trading futures, you should focus on trading contracts with high volatility. Some traders favour volatile markets because it allows them to make greater profits while maintaining the same level of transactional costs.

On the other hand, investors with a lower risk tolerance can consider less volatile contracts. Therefore, you need to carefully consider its volatility level before deciding which option is superior. Your comfort level with taking risks ought to determine this. The investor should determine the level of market volatility by gathering adequate data and then computing the standard deviation as well as the mean range of the market. Both of these metrics show the level of market volatility.

Contract size

To begin, we must have a common understanding of what the contract size entails. The amount of underlying financial instruments for futures contracts traded on an exchange is the contract size. There is a correlation between risk exposure and contract size. When the contract size is larger, there is the possibility of greater rewards.


You now have a few options determined by the volume, margins, and movement. E-Mini S&P 500 futures and 10-year Treasury notes are good places to start trading. These things generate a lot of fluctuation and volume daily, in addition to poor day trading margins. As you develop, you may also investigate crude oil futures. They are more volatile than the previous two, and their day trading margins are greater. They have slightly less volume than the previous two. That indicates you need a trading account with more features to engage in that activity. Despite their large volume, eurodollar futures are not a market that is open for day trading. Now that you know what to search for, you can pull up an intraday chart to determine which one best fits your day-trading methods.

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