On mt4 platforms, you will learn that currency futures are the exchange-traded futures. Traders have accounts with the brokers that direct orders to different exchanges to sell and buy currency futures contracts. A margin account, in most instances, is used for trading currency futures. If not, a lot of cash would be needed to place a trade. With a margin account, traders would have to borrow money from the broker for placing trades, which is normally a multiplier of the exact cash value of the account.
The buying power is the money amount in the margin account you will get to trade. Various brokers have different requirements for their margin account. Generally, the accounts for currency futures tend to allow a conservative margin – leverage compared to the forex accounts that can offer much leverage of 400:1. The margin rates that are liberal of most forex accounts allow traders to make gains that are impressive but end up suffering catastrophic losses.
The currency futures vs. the forex Both the forex and currency futures are based on the rates of foreign exchanges. But there are some differences between the two: • The forex's spot market is the largest worldwide, while the currency futures are just a fraction of that volume, with most of the contracts for currency futures trading under the good liquidity and high volume.
• With the currency futures, they are exchange-traded and tend to be regulated like the other futures markets. Forex, on the other hand, has fewer regulations, and the trading is done over the counter via the forex dealers. You will not get any central market when it comes to forex. • For the currency futures, you can trade it using modest leverage. Forex offers the ability to deal with very high power, which leads to higher wins and large losses.
For more details make sure you click on this particular link trading platforms.