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HomeGoldGold Futures and Gold Spot Distinctions

Gold Futures and Gold Spot Distinctions

 

  1. Trading mechanism

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Gold futures: there is a delivery date, the delivery must be due, otherwise will be forced to close or physical delivery, at the same time, the margin is insufficient will also be forced to close.

Spot gold: no delivery limits, unlimited holding, but insufficient margin will be forced to liquidate.

  1. Trading capital

Gold futures: with 10% of the capital can do 100% trading, capital magnification 10 times.

Spot gold: Depending on the different magnification of the gold company also varies, but most can use 1% of the capital to operate 100% gold, 100 times the magnification ratio, the multiple is calculated by hand.  Example: 1 standard hand =100 oz, some platforms can do 0.1 hand, etc., but spot gold is not regular enough globally. 

  1. Trading hours

Gold futures: Trading hours are 9:00-11:30 A.M. and 1:30-3:00 p.m. As a result of short trading time and international gold prices are not in line, short jump phenomenon is frequent, investors can not enter the market at the beginning of the first time.

Spot gold: Due to the time difference, domestic trading is available from 8 am Monday to 3 am Saturday, that is, all day trading.  It can be entered at any point in the market, and has an advantage over futures in price continuity. The most active trading session is between 8.00 and 24.00.

  1. Increase limits

Gold futures: according to the variety of futures different daily limit 3 -15%.

Spot gold: no limit to increase.

  1. Open an account

Gold futures: start no less than 30 thousand.

Spot gold: In general, the standard warehouse account on the platform is 5000 US dollars, which is about 3W RMB, while some platforms can open mini warehouse, which is generally about 1000 US dollars.