Finding a futures broker

An important decision you need to make as a futures trader is your choice of adviser.

A broking firm must hold a licence in order to deal in or advise on futures. Please refer to a current list of Futures trading and clearing participants.

In addition to this, the individual adviser you use must be accredited to advise on futures. 

If you already have an adviser for your share investing, and this adviser is also accredited to advise on futures, there may be no need to look further. However, if your existing broker is not accredited to advise on futures, it is wise to seek out a specialist broker in this area.


Services required by the futures trader

The needs of the futures trader are different to those of an investor who may only invest on a buy-and-hold basis.

Futures trading generally will require more frequent monitoring than share trading alone, because of the leveraged risks associated with futures and because of the limited life of a futures contract. You should be confident that your broker offers the level of service that you require.

Qualifications required by a futures adviser

To give advice regarding derivatives transactions, an adviser must be accredited by ASX. The accreditation requirement is designed to enable advisers to give quality advice and service on ASX derivatives products.

When considering your choice of adviser, you should check that your adviser is accredited to advise on futures. 

Commission
Commissions charged by brokers vary and can be:

  • a flat fee, charged on a per transaction basis
  • on a percentage basis i.e. a percentage of the gross value of the order, or
  • a combination of these two, such as a flat fee for orders up to a certain dollar value, and a percentage charge thereafter.

Choosing the right adviser
You may wish to contact several advisers to find out about:

  • the service they provide
  • the brokerage they charge
  • the size of accounts they handle
  • their investment philosophy

It is also useful to meet with an adviser in person before making your final decision. You should feel comfortable with your adviser and have confidence that they will provide the sort of service you require.

Under the Corporations Law and ASX Market Rules, an adviser must consider a person's investment objectives, financial situation and particular needs in making any securities recommendations. It is important that you have confidence that your adviser understands your circumstances before you instruct them to act on your behalf.