Futures traders must open a futures account with an amount of money deemed appropriate by a particular brokerage firm. The amount of money to be carried in a futures account varies by firm. Although a securities customer could potentially open a futures account with his or her securities firm, that firm would require a designation of being a futures commission merchant. Additionally, a broker dealing with futures customers is required to hold a "Series 3" registration, which qualifies him or her to transact futures business for futures customers.
When opening a futures trading account, a number of documents -- including risk disclosure documents -- must be signed by the customer before he or she can begin trading.
As a normal course, before you open a futures account, your futures broker will ask you to sign documents acknowledging:
- that you realize that futures trading could involve risk of loss
- that because low futures margins normally are required, price changes could result in losses which could exceed your margin (also known as performance bond)
- that you know that if you are trading electronically, that there could be risk associated with technical problems, system capacity issues and the like
- how your account is to be handled by the broker.
There may be other documents, as well.