One of the questions that frequently comes up with option traders who have only done the equity side of options is how do I get into trading futures options and what do I need to know before I start?  There are several basic things you should know and understand about futures and their option before you get started with live trading of them. What month should I trade? One of the first characteristics to consider is that futures do not always have a new contract every month. Many futures, U. S. Treasury bonds for instance, have only a few contract months per year. Treasuries have March, June, September   and December only. All the months in between have options only that are traded derivative of the next futures month. Strategies, such as time spreads must be placed carefully to insure that you are trading off the same underlying contract month. Get to know your futures and options expiration periods before you start.  Not only the contract months differ from the equity world, trading hours do also so be sure to know when your underlying is being traded during the day and night. What is the tick size? Tick size for the […]