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USD Futures
USD Futures TFEX has provided USD Futures to open chance for the investor who has risk in exchange rate, especially the exporter and importer, to have tool in exchange rate risk management. Moreover, it will be option for investor to manage portfolio more effectively according to risk diversification objectives or to make return from exchange rate change.
USD Futures Contract Specification
Heading |
Contract Specification |
||
|---|---|---|---|
| Underlying Asset | US Dollar | ||
| Ticker Symbol | USD | ||
| Contract Size | 1,000 USD | ||
| Settlement Months | 3 nearest consecutive months plus the next quarterly months (March, June, September, or December) | ||
| Price Quotation | The price is quoted in term of Baht per 1 US Dollar (with 2 decimal points) | ||
| Minimum Price Fluctuation | Tick size is 0.01 Baht (10 Baht per contract) | ||
| Daily Price Limit | Initial price limit is ± 2% from the latest settlement price. Should traded price reach the limit, trading will be halted for a certain period announced by TFEX. After trading resumes, the price limit will be expanded to ± 4 % of the latest settlement price | ||
| Trading Hours |
|
||
| Speculative Position Limit | Net 5,000 contracts on one side of the market in any contract month or all contract months combined | ||
| Last Trading Day | The business day immediately preceding the last business day of the contract month. The trading of an expire-series shall be ceased on 11:00 hrs. | ||
| Final Settlement Price | Calculated from the exchange rate announced by Thomson Reuters at 11:00 hrs (BKK time) on the last trading day (4 decimal points) | ||
| Settlement Method | Cash Settlement |
Commission Rates for USD Futures
From 1/01/2014 onward
No. of contract |
Commission rate (Baht/Contract) |
|
|---|---|---|
Via Markething Officer |
Via Internet |
|
| From 1st- 2,000th contract | 12.00 | 11.00 |
| From 2,001st contract onward | 9.00 | 8.30 |
Pre-Trade Knowledge
Advantage of FUTURES Contract
- Buyers and Sellers have authority in setting price.
- No need of physical delivery but use cash settlement method instead.
- Use less investment money but make more profit.
- Able to make profit in both uptrend and downtrend.
- Able to trade by the investor self via internet trading.
- There will be Marketing Officers (Brokers) to help in providing information for investment and following the market situation for the investors.
Margin Deposit in Futures Contract
Investors are required to deposit Margin with their respective broker before trading futures contract and there are following 3 types of margin.
- 1
Initial Margin (IM)
is the minimum equity required to initiate a futures position and equal to only 10% of underlying asset’s value.
- 2
Maintenance Margin (MM)
is a set minimum margin per outstanding futures contract that a customer must maintain in their margin account and equal to 70% of contract value.
- 3
Force Close (FC)
is the case when the margin level decrease to Force Close Margin Rate or 30% of contract value, the brokers have rights to close the account to cut loss instantly unless the investors can deposit additional funds to meet Initial Margin requirement within 1 hour.
Mark-to-Market
Date |
Transaction |
Closed Price |
Profit/Loss |
Transferred In/ Transferred Out |
Margin Amount |
|---|---|---|---|---|---|
| 03/02/2009 | Buy Gold Futures at 15,000 baht | 70,000 baht | |||
| Profit/loss adjustment | 15,080 baht | 4,000 baht (80 X 50) |
74,000 baht | ||
| 04/02/2009 | Profit/loss adjustment | 14,800 baht | -14,000 baht (280 X 50) |
60,000 baht | |
| 05/02/2009 | Profit/loss adjustment | 14,500 baht | -15,000 baht (300 X 50) |
45,000 baht | |
| 06/02/2009 | Deposit additional margin | 25,000 baht | 70,000 baht | ||
| Sell Gold Futures at 15,050 baht | 27,500 baht (550 X 50) |
97,500 baht |
3 Feb
Mr. A buys gold futures at 15,000 baht for 1 contract. After the price is at 15,080 baht, the market will Mark-to-Market to calculate profit/loss by comparing between closed price and buy price 15,080 -15,000 = profit 80 baht X 50 (1 gold futures contract is equal to 50 baht). Therefore, Mr. A will get profit 4,000 baht and whole margin amount is equal to 74,000 baht.
4 Feb
The price is lower to close at 14,800 baht. The calculated profit/loss is equal to 14,800 – 15,080 = (280*50) or loss 14,000 baht and the margin amount is equal to 60,000 baht.
5 Feb
The price is lower to close at 14,500 baht. The calculated profit/loss is equal to 14,500 – 14,800 = (300*50) or loss 15,000 baht and the margin amount is equal to 45,000 baht. Therefore, Mr. A is required to deposit additional margin 25,000 baht within the next day.
6 Feb
The price is lower to close at 14,500 baht. The calculated profit/loss is equal to 14,500 – 14,800 = (300*50) or loss 15,000 baht and the margin amount is equal to 45,000 baht. Therefore, Mr. A is required to deposit additional margin 25,000 baht within the next day.
Trading Steps
- 1
Register and open account with MTS Gold Futures with following required documents.
• Copy of ID card
• Copy of House Registration
• Statement or Book Bank Transactions in last 3 months.
• Copy of Book Bank (Only Kasikornthai Bank, Bangkok Bank, Krungthai Bank, and Siam Commercial Bank) - 2
Statement or Book Bank Transactions in last 3 months.
- 3
Send trading order to broker via telephone or trading by the investor self via internet trading.
- 4
Mark-to-Market
For your information regarding to profit or loss in your investment, TFEX will update your trade status in daily basis by adding fund to your margin account if you have profit on the contrary if you have loss, TFEX will deduct the amount of fund in your account.
- 5
Please be noted that you should recheck your account status to control risk and update your portfolio along with the market conditions.
