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The Dow Jones Industrial Average is the top market on Wall Street.Dow created this market in 1986 and he wanted to make sense of daily market trends and overall patterns.Dow started with traversing the trading designs of eleven companies.  Today, the Dow holds thirty of the biggest, most well known companies in the world.Companies like Disney, Coca Cola, IBM, General Motors, Exxon and Microsoft will be recognized by you.  These companies are traded on the floor of the Stock Exchange in New York City from 9:30 am to 4:00 pm eastern time five days a week.

The futures market and stock exchange are separate but have some sort of connection.7:20 am central time in Chicago is the starting trade time of Dow Futures Market which is just over an hour before the stock market opens.Futures Market opens an hour earlier so as to give the instructors a clue of the day’s position before the stock market actually opens.If future trading shows a rise then stock trading is likely to go up.

Futures are actually contracts between two teams which agree to interchange money when deliberate conditions are fulfilled.Exchange is the only place where Dow Futures trade.This means that the investors drive into acknowledged relationships with the exchange.The contract is closed once the terms of the contract are met.

The advantage of using exchange for trading is that the exchange is always being monitored to see that it can back up is end of bargain.This shortens the accountability investors must face when investing.Trading by the exchange should be in real assets in order to protect the investors from fake hypothesis.

One advantage of futures market is increased leverage ability which allows the investors to earn more than what they would have earned by investing in the stock market alone.   The Dow Futures market works on a ten to one basis.This can be analyzed such that a one point increase is worth ten dollars for the investor.

Futures contracts are marked to market, meaning that any changes in value are recorded in the investors account at the end of each day until the contract expires.  If an investor buys Dow Futures contracts, and the Dow gains one hundred points, then based on the Dow multiplier of ten, $1,000 will be added to the investors account at the close of the day.
One reason Dow e-mini index Futures is so popular with investors right now is the low cost.This market is very acceptable compared to other e-mini markets.This market is much more forgiving than other e-mini markets.

But don’t let that make you enter some false sense of guarantee.  This market has a tendency to be volatile, and requires constant risk assessment and management.So it attracts the beginners as well as the professional traders.

Because the index and the futures contracts are so closely related, the futures contracts are used to gauge the direction the stock market is likely to move, and therefore has great influence on the trading of Dow stocks.