What is a futures contract? It’s an agreement to buy or sell something at a fixed price and date in the future. The standard contract size for commodities and currencies is 100 units, but they can be smaller or larger; contracts are quoted as per unit. Here you’ll learn about five of the most common strategies employed when trading futures contracts.
The first of these strategies is scalping, which involves executing multiple daily trades that usually expand over several days to weeks. Essentially, market participants engage in numerous short positions with offsetting long positions within minutes or hours, resulting in virtually no risk on any trade (a slight loss, if ever).
This strategy has three goals. To generate profits on constant price fluctuations, capture the bid-ask spread that is otherwise lost by holding positions overnight or longer and avoid overnight interest charges for carried positions.