Here are a few additional requirements that can be beneficial for futures traders, especially for those just starting out:
- Capital Requirements: Because we will be working on getting you funded, your out of pocket capital is limited to the cost of your evaluation and the expense of obtaining your live trading accounts.
- Understanding Leverage: Futures trading often involves leverage, which can amplify both gains and losses. Traders should be comfortable with the concept of leverage and understand the risks involved.
- Time Commitment: While trading may start as a hobby, it requires a significant time commitment to monitor markets, learn strategies, and develop skills. New traders should be prepared to invest time into their education and trading activities.
- Emotional Control: Futures trading will be emotionally challenging. Traders should be prepared to manage emotions such as fear and greed, which can cloud judgment and lead to poor decision-making.
- Regulatory Knowledge: Futures trading is regulated, and it’s important to comply with regulations set by organizations like the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA). New traders should be aware of these regulations and trade within legal guidelines.
- Technology Proficiency: Since futures trading is often executed electronically, new traders should be comfortable with trading platforms and have reliable internet access to ensure timely trade execution.
- Risk Management Plan: Beyond just discipline, traders should have a comprehensive risk management plan in place, including position sizing, stop losses, and capital allocation strategies to protect their account from significant losses.