How to Trade Gold Futures for Beginners

What is a futures contract?

A futures contract is a legal agreement to buy or sell an asset, such as gold, at a set price on a specific date in the future.

Futures contracts have multiple expiry dates. The front-month contract is the one with the nearest expiration and usually sees the most trading activity. As of June 2025, gold's front-month futures contract was GOLD_AUG25, expiring in August.

Gold futures contract specs

With AvaTrade, you can trade CFDs on the front-month gold futures contract with high leverage. These are this instrument's key details:

Use these two calculations to manage your position:

• Required margin per lot: Current price × lot size × margin % = 3,347.03 × 100 × 0.005 ≈ $1,673.52
• Tick value: A $1 move in the gold price = $100 per full lot (100 oz × $1)

You'll pay the spread when opening and closing a position. Overnight trades may also incur or earn swap fees, visible in the instrument details tab.

Trade gold futures in 5 steps

1. Create your account

Start by visiting AvaTrade.com to open a free trading account to follow this tutorial step-by-step.

To trade live, verify your account with an ID and proof of address, and fund your account with a bank card or a bank transfer.

Not ready to risk real money? Use AvaTrade's demo account with $100,000 in virtual funds to practice risk-free under real market conditions.

2. Find the gold futures contract

Login to MetaTrader or the AvaTrade web platform and follow these steps:

• Click 'Commodities' > 'Metals', then look for GOLD_AUG25.
• Click the i-icon to confirm the lot size, leverage, and trading hours.
• Switch to a 1-minute or 5-minute chart for the latest price action.
• Enable one-click trading under 'Tools' > 'Options' > 'Trade' tab in MT4/MT5.

3. Choose your trade size

First, decide how much you're willing to risk on this trade. Let's say your risk limit is $200.

Assume gold is trading at $3,347 and you want a stop-loss at $3,300 (a $47 difference). At $1 per tick per ounce, that's 47 ticks or $47 per ounce.

To keep risk within $200, you must risk no more than $4.25 per tick ($200 ÷ 47 ticks).

Since a full lot moves $100 per tick, your max position is 0.0425 lots ($4.25 / $100).

4. Check your margin

Make sure your account can cover the margin for 0.0425 lots.

Although $71.12 is the minimum equity you must maintain, most traders keep 2-3x that amount free to avoid a margin call from overnight swaps and/or ordinary price movements.

Your risk only amounts to the $200 you set via the stop-loss. Margin isn't what you stand to lose; it's merely "good-faith money" so your broker knows you can cover day-to-day price swings.

5. Place your order

Now you're ready:

1. Click 'BUY' as we expect gold's price to rise in this example.
2. Set lot size to 0.0425.
3. Place a stop-loss at $3,000.
4. Optionally, set a take-profit target.

Click 'Place Order' to execute the trade. You've just completed your first gold futures CFD trade!

COMEX vs. CFD gold futures

COMEX gold futures are physically deliverable, but most traders roll over or close out before expiry. In contrast, CFD gold futures always settle in cash. That means you'll never have to worry about physical delivery.

Conclusion

Trading gold futures CFDs on AvaTrade.com is a practical way to speculate on price moves without holding physical bullion. Start small, calculate your margin and tick value as illustrated in this guide. Consider using a demo account to gain experience before risking real capital.

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