Currency futures - why?

[Martinghoul]

Quote from zboy2854A:
There's one other major reason one might prefer to trade the futures instead of cash market, and that is interest rates. Depending on what currency pair you wish to trade, you may end up having to pay interest to hold a position in the cash market, whereas no matter what pair you trade in the futures market, you are not liable for any interest payments.

Of course, this only applies if you are holding the position for longer than a day, and assumes you're trading a pair that would require you to pay the interest differential. In cases where you would benefit by receiving the interest differential (aka carry trade), obviously you'd want to stick with the cash market.

This is all priced in by the futures mkt. Unless your broker doesn't do the FX carry correctly (e.g. like IB), this is no reason to prefer futures over spot.

 

[shopster]

Quote from NetTecture:

One reason is that "Spot" does not exist.

Forex is unregulated, so it is not "there" as in organized, a lot depends what banks you have available.

Second is that it is unregulated.

Futures follow a well published regime with an orderly independent maintained market.......

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looks like i have been trading " something that does not exist for 7 years........."

damn.

so, futures must be the better road to travel, corzine et al.

hows that working for you....?

s