The speculators are investors that profit from price changes, they usually buy when the price of financial instrument is low and sell when the price is high. The speculators are highly interested in futures market due to potentiality of high profits. The cost of transaction in futures market is lowThe speculators are interest because the transaction cost in futures market is low compared to other types of market such as stock market. The futures market is open to all the investorsThe speculators are interested in futures market because the futures market is open to all traders regardless of the size of the traders investment. All the traders have relatively equal access to the futures market. The margin and high leverage in futures marketThe traders do not pay the full price of the futures they can only pay the margin of the futures to trade, therefore the leverage is high which leads to high profit, but it also means high loss. For example, if the futures price is $1000, the trader can trade that with only $100 or in some cases as low as $10.
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