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Margin Requirements, Leverage, Pricing, and ThinkOrSwim Platform TD Ameritrade ThinkOrSwim Futures Trading Investors and traders with an interest in futures trading may want to consider an account with TD Ameritrade, which now owns the trading platform Think Or Swim. TD Ameritrade acquired Think Or Swim TOS to be able to offer its high functionality as a platform to customers that trade actively, but TOS also brought another level of live futures trading to the TDA customer.
TD Ameritrade Futures Commissions TOS hosts more than 50 futures products in a variety of categories, such as commodities, stock index futures, currencies and bonds. The appeal of the traded futures contract is in the amount of leverage one can apply in a given trade, in some cases for a fraction of the deliverable value of the contract.
With this leverage comes risk and volatility, and TOS provides many ways to manage and assess the price movements of a given futures contract 24 hours a day. Once the contract is sold, the margin will be restored at the end of the trading day to fund new trades. Because of this unique character of futures, trades may be executed quickly and repetitively, to catch small price movements for profit, or to simply add to existing positions.
The TOS platform is proprietary software that downloads for most new computer operating systems, as well as an application for tablets and handheld devices. The operating system requirements changed recently during an upgrade, and older versions of Java are not supported.
If, at any time, your account falls below this threshold your account will automatically revert to the TD Ameritrade Futures and Forex Margin requirement for the particular Futures contract held.
TD Ameritrade Futures and Forex reserves the right to change this minimum threshold at any time and without notice. TD Ameritrade Futures and Forex reserves the right to modify the Intraday Margin rate at any time and without notice.
Intraday Margin is not available to IRA accounts permissioned to trade Futures. Intraday Margin does not apply to Options on Futures. If you hold or place an order for Options on Futures the system will automatically remove Intraday Margin for the entirety of the account. Trading Futures on the TD Ameritrade TOS Platform Once one has gained futures trading permission from TD Ameritrade and funded their account, the platform is available for trading.
For those new to futures, there is a paper trading also called virtual trading read review side of TOS with equivalent functionality, but no funding, which is ideal for practicing and learning the platform.
Futures Trading | TD Ameritrade
The first things that are obvious are how easy and intuitive it is to learn the system, and that the graphics have excellent visual clarity and smooth movement as price changes on the chart display. One can choose chart time frames from one minute up to a monthly chart depending on the preferred trading horizon, and easily select from hundreds of studies and chart tools for analyzing price direction, volume, momentum and technical levels.
Margin Trading for Investment Strategies | TD Ameritrade
Drawing tools allow for custom trend lines and pointers as well as the ability to write text notes directly on the chart. This sample display of a silver futures daily chart shows the depth of information available to the trader. The selected candlestick chart is color coded for up or down daily price movement, moving averages are displayed in user-selected colors and drawn trendlines show support and resistance levels clearly.
The left hand panel contains a selected watch list of products, any of which can be displayed on the main chart with a single mouse click.
The lower panel shows daily futures contract volume and open interest. It is easy to see from these chart tools and studies that silver had been in a move lower for several months, contained by both declining trendlines and major moving averages.
Not shown on the right hand panel is the Active Trader tab, which reveals the moment to moment price movements, which offers the ability to trade by simply clicking either the bid or ask at a given price point. Trades can be executed in seconds, and hundreds of trades may be made through custom button configurations in a single session for professional price scalpers.
The dashboard tab reveals the margin requirements for the displayed contract, as well as the amount of profit or loss for each tick, or increment of price. This link to TDA describes more of the futures trading features, as well as an overview of strategies and the educational resources available.
Pitfalls of Futures Trading With TD Ameritrade TOS No trading platform is perfect and there can be glitches with the TOS execution or order routing system at times, and it is not immune to freezing up.
Ironically, another pitfall is the platforms ease of use. The futures market is generally open 24 hours a day, so time spent trading and level of activity has to be monitored to avoid account churning.
As with any trading or investment strategy education is the key, and TOS has many resources to inform new traders on the risks and benefits of futures trading. Safest discount brokers Top rated investment firms Ameritrade vs Etrade vs Scottrade Charles Schwab assets under management Vanguard vs Fidelity.