A popular broker recently launched a Danish version of an online futures trading platform, providing Danish investors access to trade stocks, commodities, indices and cryptocurrencies.

Before this, such a service had not yet been made available here in Denmark. Therefore, it is still a relatively new ground to navigate when deciding how to apply trading strategies with success on this platform.

The different types of contracts are traded on the same interface and under one single dealing desk, thus making trading much more straightforward. However, some complexities need to be understood before proceeding further.

The first step involved determining which futures strategy you will employ should start by understanding how each instrument can fluctuate according to its dynamics based on supply and demand factors rather than an individual company’s performance.

It is essential to understand that commodities prices may be based on the demand of raw materials and agricultural products rather than just related to their production or retail price.

While you might not know all the intricacies of trade with non-equities, here you will find a list of futures trading strategies that can help make your journey as profitable as possible.

Market order

A Market Order opens a position by buying or selling at the current market price, instructing your broker to go long (buy) or short (sell). This order type should only be used when you are confident about correctly predicting where the market will open for business following its opening bell.

Otherwise, if you guess incorrectly, you risk having your order executed much further away from the price you originally wanted.

Limit orders

Limit Orders require a fixed limit you wish to buy or sell an asset, and no more than this maximum price will be executed. The critical difference between this and a Market Order is that with Limit orders, it is possible for an order not to be completed during trading hours if there is insufficient liquidity within the market; as such, this may create unfilled orders, also known as ‘stops’.

Stop-loss order

A Stop-Loss Order can be used with market and limit orders and acts as a safety net for your trades. It can automatically sell out of losing positions before they become too much of a threat to your account balance. As such, you can limit your losses while still enjoying any gains made.

Stop-limit-order

A Stop-Limit Order uses features from both limits- and stop orders. However, this time, it is executed after an order has been triggered, but only once the price reaches a pre-determined level beyond which you are no longer prepared to allow the asset’s value to fall.

It allows for far more precision in your trading, thus allowing you to make much more intelligent choices about when to cut back or sell items that could otherwise become dangerous liabilities over time.

Trailing stops

Trailing Stops can also be used in conjunction with market and limit orders; however, it works by automatically following up with another order which will lock in profits once the price reaches a specific limit beyond the current market value.

It is considered beneficial where you are more confident in your prices but still wishes to ensure that your returns are protected by locking in the best deal possible at all times. Your position will never be closed out at a loss, provided you set your limits correctly!

One-cancels-other

One Cancels Another order is an alternative version that works on two separate orders. To ensure that when one of them has been executed, the other automatically follows through with its orders before then, allowing for another to occur after either is completed or cancelled depending on which one was acted upon first.

The idea behind this type of strategy is to define both stop and limit points within a single order, thus guaranteeing that even if one part fails to be executed, the other will still go on as planned. Check out Saxo for more info on futures trading.