Comparison of various aspects of futures and stocks
1. Variety: There are only a few active futures varieties, which is easy to analyze and track. There are more than a thousand or even thousands of stock varieties. It is difficult to read them all, and even more difficult to analyze them.
2. Funds: Futures are margin transactions. You can do 100% of the transactions with 5% of the funds. The funds are magnified 20 times, and the leverage effect is very obvious. Stocks are traded on full margin, so you can buy as much stock as you have.
3. Participants: Futures are participated by producers and dealers who want to avoid price risks, as well as speculators who are willing to bear price risks and obtain risk profits. Most of the participants in stocks are speculators, and speculators get stuck at high prices and are forced to become investors.
4. Function: The most significant feature of futures is that it provides spot traders and dealers with a market to avoid price risks. The main function of stocks is financing, which is what everyone often calls money trapping.
5. Information disclosure: Futures information mainly includes reports on production, consumption, weather in the main producing areas, etc. Professional newspapers have reports, and the transparency is very high. The most important thing about stocks is financial statements, and more than 60% of listed companies have committed fraud.
6. Subject matter: Futures contracts correspond to fixed commodities such as copper and soybeans. The underlying object of the stock index is the stock price index. Stocks are securities.
7. Price: The futures price of futures commodities is constrained by everyone’s expectation of future trends. As the delivery month approaches, the price will become consistent with the spot price. The stock price is mainly determined by the value of the stock, and is also related to the hype of market makers, and is closely related to the trend of the market.
8. Risk: Futures commodities have costs, and excessive deviations in futures prices will be corrected by the market. Its risks mainly come from the participants' reasonable grasp of positions and operational level. Stocks can be delisted and their stock prices can fall very low.
Even if you have a high level of operation, it is not easy to see which company is making false accounts