Futures Course

Lesson 1 • Anatomy of a Futures Contract

Defines the standardized components of a futures contract, including delivery terms and tick size. Connects contract design to market liquidity and participant behaviour.

Lesson 2 • Origins and Purpose of Futures

Traces the historical development of futures markets from commodity exchanges to modern financial instruments. Establishes why price discovery and risk transfer are central functions.

Lesson 3 • Exchange Infrastructure and Clearing

Explains how exchanges and clearinghouses guarantee contract performance and manage counterparty risk. Grounds students in the institutional backbone of futures trading.

Lesson 1 • Arbitrage and Fair Value Enforcement

Shows how cash-and-carry and reverse cash-and-carry arbitrage keep futures prices aligned with fair value. Students identify arbitrage windows and understand their limits.

Lesson 2 • Spot Price vs. Futures Price

Distinguishes spot and futures prices and explains the basis relationship between them. Lays the groundwork for all subsequent pricing and hedging calculations.

Lesson 3 • Dividend and Yield Adjustments

Incorporates dividends, coupon rates, and foreign yields into futures pricing models. Ensures accurate fair-value calculations for equity index and currency futures.

Lesson 4 • Cost-of-Carry Model

Derives the cost-of-carry formula incorporating financing, storage, and convenience yield. Students apply the model to commodities, equities, and interest rate futures.

Lesson 1 • Margin Management Best Practices

Covers strategies for maintaining adequate margin buffers and responding to adverse market moves. Prepares students to avoid forced liquidation through proactive account management.

Lesson 2 • Initial and Maintenance Margin

Defines initial margin as a performance bond and maintenance margin as the minimum balance threshold. Establishes the financial commitment required to hold a futures position.

Lesson 3 • Daily Mark-to-Market Process

Explains how gains and losses are credited and debited each trading day through settlement prices. Connects daily P&L realisation to the clearinghouse guarantee function.

Lesson 1 • Interest Rate and Currency Hedging

Applies interest rate futures to manage duration risk and currency futures to hedge foreign exchange exposure. Connects hedging mechanics to corporate treasury and fixed-income portfolio management.

Lesson 2 • Commodity Hedging Applications

Applies short and long hedges to producers and consumers of physical commodities. Covers cross-hedging when no exact futures contract exists for the underlying commodity.

Lesson 3 • Optimal Hedge Ratio Calculation

Derives the minimum-variance hedge ratio using regression of spot and futures price changes. Students compute and apply hedge ratios to determine the correct number of contracts.

Lesson 4 • Equity Portfolio Hedging

Uses equity index futures to adjust portfolio beta and protect against broad market declines. Students calculate the number of contracts needed to achieve a target beta.

Lesson 1 • Position Sizing for Speculation

Applies fixed-fractional and volatility-adjusted sizing methods to speculative futures positions. Ensures students balance return potential against account drawdown risk.

Lesson 2 • Trade Management and Exit Discipline

Covers trailing stops, partial profit-taking, and position review processes for active futures trades. Builds the behavioural discipline needed to execute a speculative plan consistently.

Lesson 3 • Spread Trading Strategies

Introduces calendar, inter-commodity, and inter-market spreads as lower-volatility speculative trades. Students analyze spread behavior and margin advantages relative to outright positions.

Lesson 4 • Seasonal and Cyclical Patterns

Identifies recurring seasonal tendencies in commodity and financial futures driven by supply-demand cycles. Students evaluate historical patterns and integrate them into trade timing decisions.

Lesson 1 • Combines Technical and Fundamental Signals

Builds a multi-factor trade decision framework that aligns fundamental bias with technical entry timing. Students practice filtering high-conviction setups from conflicting signals.

Lesson 2 • Momentum and Oscillator Indicators

Introduces RSI, MACD, and stochastic oscillators as tools for identifying overbought and oversold conditions. Students apply indicators to filter entries and avoid chasing extended moves.

Lesson 3 • Fundamental Supply and Demand Analysis

Applies balance-sheet modelling of supply, demand, and inventory to forecast commodity price direction. Extends the framework to financial futures using macroeconomic indicators.

Lesson 4 • Chart Patterns and Trend Analysis

Applies trend lines, moving averages, and classic chart patterns to futures price charts. Provides the visual analysis toolkit used in daily futures market evaluation.

Lesson 1 • Performance Attribution and Review

Decomposes portfolio returns into market selection, timing, and sizing contributions. Builds the analytical habit of learning from both winning and losing periods.

Lesson 2 • Correlation and Diversification Effects

Measures correlation between futures markets and quantifies diversification benefits in a multi-market portfolio. Students construct portfolios that reduce concentration risk without sacrificing return potential.

Lesson 3 • Portfolio-Level Greeks and Sensitivities

Aggregates delta, DV01, and commodity beta exposures across a multi-market futures book. Enables students to monitor and rebalance total portfolio risk in real time.

Lesson 4 • Drawdown Control and Risk Limits

Establishes maximum drawdown thresholds, daily loss limits, and position-level risk caps. Provides the governance structure needed to prevent catastrophic account losses.

Lesson 1 • Order Types and Execution Quality

Compares market, limit, stop, and conditional order types and their impact on fill quality and slippage. Equips students to select the optimal order type for each trading scenario.

Lesson 2 • Strategy Integration and Professional Workflow

Synthesizes all prior course content into a repeatable professional trading and risk management workflow. Students produce a complete trading plan that integrates analysis, execution, and review.

Lesson 3 • Algorithmic and Systematic Trading

Introduces rule-based trading systems, backtesting methodology, and the risks of overfitting. Students evaluate systematic strategies using out-of-sample testing and walk-forward analysis.

Lesson 4 • Market Microstructure and Liquidity

Analyzes bid-ask spread dynamics, order book depth, and the impact of large orders on price. Students use microstructure knowledge to time entries and exits more effectively.