The Future for Futures?

Futures trading today encompasses almost 30million contracts every month ranging in value and sector, to help fund managers and private investors speculate on long term price fluctuations and hedge against the risks of other investments/manufacturing costs.  Throughout their long and illustrious history, futures have proven to be a tool of convenience, and one that provides significant benefits for both the buyer and seller, and as one of the oldest derivative instruments around, futures have stood the test of time as a vital trading asset.

From their early adoption in the ancient global civilisations as a tool for merchants and farmers, futures have grown to become a massive international business, with investment funds and private investors diversifying their existing portfolios to spread the risk of wayward investments.  Over the last 20 years, the leaps forward in technology have allowed futures to blossom into a popular trading instrument, with the advent of exchanges and live markets making futures trading a feasible option for both fund managers and consumer traders, and as technologies continue to develop and progress there is no doubt futures will continue this path of development.

But what does the future hold for futures? What possible innovations lie ahead with futures, and how will the markets respond to meet the demands of futures traders going forward?  The answers almost certainly lie in technology, and in the integration of new trading methods and triggers.  In recent years we’ve seen the development of sophisticated trading bots, which will continue to improve in their efficiency and effectiveness when it comes to spotting profitable trades.

Similarly, as trading platforms and exchanged grow to facilitate even faster, even more intuitive trading, it is foreseeable that the futures market will open even further to a consumer investor demographic, which will yield benefits both in terms of market liquidity and also for the futures brokerage industry.

Likewise, as natural commodities run increasingly scarce over the course of the next century, the value of futures contracts will be significantly enhanced.

Be Sociable, Share!