Futures FAQs

Any questions you have about Futures and Options Trading will most likely be answered here

There are three different terms for describing where an option is trading in relation to the price of the underlying security. These terms are ‘at the money’, ‘in the money’ and ‘out of the money’. If XYZ stock is trading at a price of 100, the November 100 call is considered to be trading ‘at the money’. If XYZ stock is trading at a price greater than 100, say 102, the call option is considered to be ‘in the money’. An if XYZ is trading at a price less than 100, say 98, the call option is considered to be trading ‘out of the money’. Conversely, if it was an XYZ November 100 put option and if the price of XYZ stock was 102, the put option would be considered to be ‘out of the money’. And if XYZ stock was trading at a price of 98, the put option would be considered to be trading ‘in the money’. If XYZ stock was again trading at 100, the put option would be ‘at the money’.

OMFinancial requires a minimum deposit of $10,000 to open an account. Traders must maintain a balance $10,000 in the account at all times. OMFinancial has varying levels of margin call activity based on your equity balance vs. your initial margin requirement. You should always have more than the required minimum initial margin in your account at any one time so as to provide a buffer in case of any adverse price movement.

If the market moves against a customer's position, OMFinancial will request additional funds through a "margin call." If there are insufficient available funds, and the ‘margin call’ is not met within the required time frame OMFinancial will immediately close out the customer's open positions.

You will be charged a flat fee on a per lot per side basis. The fees are based on the volume of trades you execute, the higher the volume the lower the fees. There is no charge to place orders or call levels you will only be charged when an order is executed.

An obligation to exchange a good or instrument at a set price on a future date. The primary difference between a Future and a Forward is that Futures are typically traded over an exchange (Exchange-Traded Contacts - ETC), versus forwards, which are considered Over The Counter (OTC) contracts. An OTC is any contract NOT traded on an exchange.

In this section we describe the Futures market in some detail. In order to gain a practical understanding of Futures trading, there is no better way than to open an account and start trading.

OMFinancial has access to most financial markets around the globe. For full details of the available markets please contact OMFinancial directly.

You should arrange a time to meet with one of OMFinancial’s client advisers who will explain trading to you in detail. It is then simply a matter of - Completing OMFinancial’s Client Application form and supplying the necessary documentation; - Reading and agreeing OMFinancial’s Terms and Conditions; - Lodging sufficient funds to cover the initial margin on the position(s) you wish to open in OMFinancial’s bank account.

A daily statement is sent electronically from our Operations Department, which provides all transaction details, including date, price, notional amount bought and sold. Account statements are sent at the beginning of each month, and list all transactions for the previous month by currency and value date, a summary of all current open positions, and account balances as calculated at the close of business on the last business day of the month.

View the list of OMFinancial's bank account details.

Your funds deposited with OMFinancial will be paid directly into our Client Segregated Funds Account in accordance with The Futures Industry (Client Funds) Regulations 1990.

You may maintain your account in any of the major currencies covered in Margin Foreign Exchange trading. These include: New Zealand dollars; Australian dollars; US dollars; British pounds; Japanese Yen and Eurodollars. For Futures trading, your account will be a multi currency account with transactions processed in the relevant currency the futures contract is traded in.

Interest is paid on all excess funds in your account. Interest is also earned, or charged, on open currency positions depending on whether a currency has been bought or sold. These latter interest payments are credited to a bought currency (similar to a credit balance in an interest bearing cheque account) and debited to a sold currency (similar to a debit balance in a cheque account). More information is available on this topic at your request.

OMFinancial’s trading desk is open 24 hours daily from 7:30am Monday morning through until markets close on Saturday.