How to Read a Futures Statement

Futures statements may be difficult to decipher at first glance. They pack a lot of information into a relatively small space, from trading activity to margin requirements. Futures also have some unique mechanics that make their account statements look very different than traditional brokerage statements.

The good news is that these statements follow a logical and fairly simple structure. Knowing how they're organized can help traders track the most important figures and understand where their account stands. Here's how to read daily and monthly futures statements.

Here's what each column in the confirmation section means:

• TRADE SETTL: The date the trade was executed.
• AT: The futures account type associated with the transaction.
• BUY: Number of contracts bought.
• SELL: Number of contracts sold.
• CONTRACT DESCRIPTION: Type of futures contract and the contract month.
• EX: The exchange where the contract was traded.
• PRICE: The price at which the trade was executed.
• CC: The currency code associated with the transaction.
• DEBIT/CREDIT: The amount debited from or credited to the account. Debits are followed by a minus sign.

Trades in the confirmation section are grouped by the futures product being traded. In the example above, two separate transactions in COMEX High Grade Copper futures are shown together, followed by four E-mini S&P 500^® transactions.

For each group, the statement shows the average price of the long and/or short transactions, along with the last trading day (LTD) the contracts are tradable and the associated commissions and fees.

In the example, the trader bought and sold 20 September 26 E-Mini S&P 500 futures contracts. Because the purchases and sales fully offset one another, the positions were closed. And, in this case, the result was a gross loss, as indicated by the minus sign after the value in the Debit/Credit column.

The same transactions appear in the Confirmation section. The only difference here is that they are matched with the offsetting trades to determine the profit or loss. When there are multiple transactions, the lowest-priced purchases and sales are matched to determine gross profit or loss.

In this example, the statement shows a debit for a Futures Cash Sweep, which reflects cash being transferred out of the futures account and into the trader's main account. Again, the minus sign following the amount in the Debit/Credit column reflects a debit rather than a credit.

In this example, five open copper futures contracts are listed, along with their average price, last trading day (LTD), and unrealized gain or loss. The margin call section below the open positions shows the additional funds required to meet the account's margin requirements, and the age (in days) of the outstanding margin call. This section will not display if the trader is not facing a margin call.

Here's what the key figures mean:

• Beginning balance: The account's cash balance at the end of the previous trading day.
• Commission. Commissions paid to the brokerage for the day's trades.
• Exchange fee. Fees charged by the futures exchange for executed trades.
• NFA fee. Fee assessed by the National Futures Association.
• Total commission and fees. Total of all commissions and fees from the day's trades.
• Gross profit or loss. Profit or loss for the day before commissions and fees are deducted.
• Cash amounts. Deposits, withdrawals, transfers, and other cash activity posted to the account during the trading day.
• Ending balance. The account's cash balance after the day's realized trading results, fees, commissions, and other cash activity.
• Open trade equity. Unrealized profit or loss on open futures positions based on current settlement prices.
• Total equity. Account balance plus or minus open trade equity.
• Account value at market. Total market value of all positions in the account.
• Initial margin requirement. Amount required to establish the open futures positions.
• Maintenance margin requirement. Amount required to maintain the open futures positions.
• Margin deficit. Amount by which the account falls short of its margin requirement.
• Margin call. Amount that must be added to the account to satisfy the margin call.

While there's a lot of accounting terminology in the Account Summary, it's easier to understand after recognizing that the figures build on one another.

Starting with the beginning balance, the statement accounts for the day's realized trading results, commissions and fees, and other cash activity to arrive at the ending balance. Open trade equity, which reflects gains or losses on open positions, is then added to the ending balance to determine the account's total equity at the end of the day.

Finally, margin figures show the initial and maintenance margin requirements for the open positions and indicates whether the account has enough equity to meet those requirements. If there isn't enough equity, the statement shows the resulting margin deficit and margin call.

In the example above, trading activity for the month is grouped by trade date. It shows the contracts bought and sold during the month in E-mini S&P 500 futures, E-mini Nasdaq^® futures, and gold futures. The resulting profit or loss and commissions and fees for each group are also displayed, along with the Futures Cash Sweeps that occurred during the month.

In the example above, two E-Mini S&P 500 futures positions remain open at the end of the month. The statement shows there are five total contracts held and details the unrealized gain or loss on each position based on the current settlement price.

Like in the daily statement's account summary section, the monthly statement's account balances section starts with the account's beginning balance and shows the net effect of the month's activity to arrive at the ending balance. Then, net futures profit or loss isolates the trading result for the month, while account value at market reflects the ending balance, along with the value of any open positions at the end of the month.