Can You Trade Futures on Robinhood?

For years, Robinhood has built its name on democratizing investing with no-fee stock trades, a mobile-first platform and user-friendly design. But now it’s stepping into deeper waters. As of 2024, you can trade futures on Robinhood and the move marks a shift for the app once known mainly for trading meme stocks and options.

What Are Futures Contracts?

Before diving into Robinhood’s offering, a quick refresher. Futures contracts are agreements to buy or sell an asset at a predetermined price on a specific date. These contracts exist across various markets including stock indices, commodities like crude oil and gold and even cryptocurrencies.

Futures trading is inherently speculative and highly leveraged, meaning you can control large contract values with a relatively small deposit. This magnifies potential profits but also your risks. Most futures traders use them to hedge exposure or to speculate on price movement. Either way, the stakes are higher than your average ETF or stock trade.

Robinhood Futures Account: What You Need to Know

To get started, you’ll need to sign up for a dedicated futures trading account within Robinhood. This is separate from your standard brokerage account and requires additional steps including a review of your trading experience and financial situation.

Robinhood’s futures platform currently offers access to five major futures markets, with plans to expand in the future. These markets typically include contracts like the E-mini S&P 500, Nasdaq 100 and crude oil.

Account Highlights:

• Minimum deposit: $0
• Platform availability: App and web
• Futures margin requirements: A percentage of the contract's notional value, serving as a good-faith deposit
• Regulatory oversight: CFTC and NFA compliance

Keep in mind that Robinhood’s platform is designed for simplicity, so while it’s easy to use, it lacks the depth of research tools and charting features that experienced futures traders often expect.

Trading Futures on Robinhood: How It Works

Once approved for a futures account, trading works similarly to stocks or options. Search the contract, choose the quantity and decide to go long or short. Robinhood supports basic order types including market, limit and stop orders. There’s no need to worry about taking delivery of barrels of oil or cattle because Robinhood settles contracts in cash, as do most retail-friendly platforms.

Futures markets on Robinhood trade nearly 24 hours a day, five days a week, giving traders access to overnight market moves and international sessions.

What Are the Risks?

While Robinhood makes futures trading accessible, don’t mistake accessibility for simplicity. Futures contracts are leveraged, meaning small price swings can cause outsized gains or losses. If the market moves against you and your account doesn’t meet margin requirements, you could face a margin call or automatic liquidation.

Futures are also marked-to-market daily, meaning your gains or losses are calculated at the end of each trading day. That daily settlement can sting if you’re on the wrong side of the trade.

Robinhood does include educational content within its app, but beginners should consider starting with a paper trading account or investing in futures education before trading live.

Is Robinhood the Best Place to Trade Futures?

Robinhood’s futures platform is functional but not competitive with top-tier futures brokers regarding product range, research tools or low-cost execution.

Other platforms offer better pricing models, wider access to futures markets (commodities, metals and crypto futures) and more advanced trading software. 

Some standout alternatives include:

Should You Trade Futures on Robinhood?

Robinhood dipping its toes into futures is a big deal. It means this high-risk, high-reward asset class is now just a few taps away for millions of retail traders. But with convenience comes caution.

If you're a beginner interested in exploring futures with small positions and basic tools, Robinhood could be a decent entry point. Just remember, trading futures without a strategy is like skydiving without a parachute. Do your homework. Use stop-losses. And know when to walk away from a trade.

Frequently Asked Questions