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Silver Futures Trading Basics

Silver futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of silver (eg. 30000 grams) at a predetermined price on a future delivery date.

Some Facts about Silver

Silver is a soft, shiny and heavy metallic element with a brilliant white luster. A very ductile and malleable metal, its thermal and electrical conductivity is the highest of all known metals.

Besides being used as a store of value, other main uses of silver include applications in areas such as electronics, photography and as antiseptics. [Click here to learn about the various uses of Silver...]

Silver Futures Exchanges

You can trade Silver futures at New York Mercantile Exchange (NYMEX) and Tokyo Commodity Exchange (TOCOM).

NYMEX Silver futures prices are quoted in dollars and cents per ounce and are traded in lot sizes of 5000 troy ounces .

TOCOM Silver futures are traded in units of 30000 grams (964.53 troy ounces) and contract prices are quoted in yen per gram.

Exchange & Product NameSymbolContract SizeInitial Margin
NYMEX Silver Futures
(Price Quotes)
SI5000 troy ounces
(Full Contract Spec)
USD 6,400 (approx. 11%)
(Latest Margin Info)
TOCOM Silver Futures
(Price Quotes)
-30000 grams
(Full Contract Spec)
JPY 108,000 (approx. 12%)
(Latest Margin Info)

Silver Futures Trading Basics

Consumers and producers of silver can manage silver price risk by purchasing and selling silver futures. Silver producers can employ a short hedge to lock in a selling price for the silver they produce while businesses that require silver can utilize a long hedge to secure a purchase price for the commodity they need.

Silver futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable silver price movement. Speculators buy silver futures when they believe that silver prices will go up. Conversely, they will sell silver futures when they think that silver prices will fall.

Learn More About Silver Futures & Options Trading

How to Start Trading Silver Futures

To buy or sell silver futures, you need to open a trading account with a broker that handles futures trades. Most online brokerages out there only deal with stocks and stock options. Only a few such as TD Ameritrade lets you trade futures and futures options as well. TD Ameritrade also provide a virtual trading platform where beginners can try out futures and options trading in real market conditions without using real money.

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