Why active investors prefer futures.

Active investors have good reasons to opt for futures as their preferred trading instrument.

Futures are fairly simple instruments. They allow investors to open both long positions (buy) and short positions (short sell) and thus benefit from both rising and falling markets.futures trader in the pit

The futures markets are extremely liquid. As a consequence the spreads, the difference between the bid and the ask price and thus a major component of the trade cost, are very small making futures trading cheap. A second advantage of this huge liquidity is that ‘slippage’, another indirect cost of trading, is very limited.

The fact that the investor can manage (i.e. increase or decrease) his leverage is another advantage. For example, at the start a position can be opened with no or limited leverage. Should the position evolve profitably, the leverage can be increased. Hence the investor can modulate his risk.

From a single account investors can trade futures on market indices (US, UK, French, German, Japanese, Dutch ...) as well as oil, gold, silver, grain, etc. The commissions charged by brokers on futures orders are usually very small. What more can an active investor want?

The commission usually represents a small part of the cost. Say you pay a £ 2,20 commission for an order on the FTSE 100 future. In addition you have to pay the exchange fee. The exchange fee is £ 0,28 for this future.
Hence the total cost for a round-turn (i.e. a buy and sell order) is £  4,96. If your future goes up from 1.000 to 1.000,50 you make £ 5 (see section related to futures parameters). This is a mere + 0,003% movement and it fully covers your trading cost.

Orders on futures markets are executed quickly and electronically. Given that every future trades on only one market, all the orders in the world on a future are channeled to the sole market on which it trades. All the orders and execution prices are registered and displayed in real-time time. This is called the time & sales data.  It makes the futures markets very transparent.

Given that a future trades on one single market only and given that all executed orders are registered, they are very suitable to traders who want to trade on the basis of charts and technical analysis!