Currency trading is very popular among private traders. Active traders and day traders in particular like to take advantage of the high liquidity and often high volatility to make profits. Forex trades are frequently used by beginners in particular. In professional trading, however, futures and options have established themselves as the most important instruments for trading currencies. In this article, you will learn what currency futures are, how they differ from forex trading and what the most important currency futures are.
A currency future is an exchange-traded standardized futures contract whose underlying is a currency. Trading takes place on a regulated futures exchange. Futures contracts for the world's most important currencies can be traded on the CME.
Currency Futures vs Forex
Like others Futures Currency futures are used both for speculative purposes and for hedging against price fluctuations and exchange rate changes. Currency futures therefore play a very important role in global trading.
Currency trading is very popular among private traders. However, many private traders, especially at the beginning, often focused on forex trading instead of currency futures.
The Forex market is an unregulated and decentralized market and takes place "Over The Counter" (OTC trading). Futures contracts are traded on a "real stock exchange". This has the advantage that trading is subject to strict regulation and clear rules.
Another advantage is that options are also available for the most important currency futures, which can also be traded in combination with futures contracts. Thus, a variety of different strategies can be mapped.
The most important currency futures at a glance
Below you will find a list of the most important currency futures. These are traded on GLOBEX, the electronic trading system of the CME. All contracts are quoted in USD. Under "Designation Future" we use the designations used by the CME. In the Trader Workstation, the designation of the futures may be different.
| Designation Future | Symbol Future | TWS symbol |
| Euro FX Futures | EUR / 6E | EUR |
| British Pound Futures | GBP / 6B | GBP |
| Japanese Yen Futures | JPY / 6J | JPY |
| Australian Dollar Futures | AUD / 6A | AUD |
| Canadian Dollar Futures | CAD / 6C | CAD |
| New Zealand Dollar Futures | NZD / 6N | NZD |
| Euro British Pound Futures | RP |
Currency futures in TWS and the Trading App
To select a particular futures contract, you have two options:
- You can type the symbol of the currency as you find it in the table above and select the corresponding future in the menu that appears afterwards. After clicking on "Futures", you still need to select the contract month.
- You can use the abbreviation, which you can find in the table above under "Symbol Future" on the right side. You still have to add the letter for the corresponding contract month and the last number of the current year to this. For example, the month code for June is "M". To call up the June 2021 contract for the euro, you must therefore enter "6EM1".