Bitcoin futures with Fidelity

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Mndiver
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Bitcoin futures with Fidelity

Post by Mndiver »

Trying to figure out how to get in on the Bitcoin game or lose my “fun money” investments. Anyone able to give me tips on how to get in on Bitcoin futures through a Fidelity brokerage account?
lack_ey
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Re: Bitcoin futures with Fidelity

Post by lack_ey »

I don't think Fidelity offers futures trading, do they?

Also should note that the CBOE contract is for 1 bitcoin (~$18,000), while CME contract is for 5 bitcoins (~$90,000), and of course you need to go long or short whole numbers of contracts. Not sure what the initial and maintenance margins would be, but I think I saw something like 1/3 of nominal value.
whiteprius
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Re: Bitcoin futures with Fidelity

Post by whiteprius »

Edit: Are you planning to short or long?
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whodidntante
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Re: Bitcoin futures with Fidelity

Post by whodidntante »

Fidelity does not offer futures.

You can buy futures at other (but not all) discount brokers. TDA, IB, Schwab, ETrade offer futures.

IB does not currently allow shorting bitcoin futures, although you can short other types of futures there. I don't know what other brokers are offering.
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Mndiver
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Re: Bitcoin futures with Fidelity

Post by Mndiver »

I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
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whodidntante
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Re: Bitcoin futures with Fidelity

Post by whodidntante »

Mndiver wrote: Sat Dec 16, 2017 2:07 pm I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
Then your best option would be to convert some money into bitcoin, not to buy and roll a futures contract.
BogleMelon
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Re: Bitcoin futures with Fidelity

Post by BogleMelon »

Mndiver wrote: Sat Dec 16, 2017 2:07 pm I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
Just out of curiosity, what's your plan if the bubble burst and you lost the money? Are you going to use another couple of hundreds to play something else and so on? Or you will quit?
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather
Topic Author
Mndiver
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Re: Bitcoin futures with Fidelity

Post by Mndiver »

BogleMelon wrote: Sat Dec 16, 2017 2:52 pm
Mndiver wrote: Sat Dec 16, 2017 2:07 pm I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
Just out of curiosity, what's your plan if the bubble burst and you lost the money? Are you going to use another couple of hundreds to play something else and so on? Or you will quit?
I have all my retirement money in Index funds. This is an extra fund I throw $100 into every month and by something new whenever I have enough. If something goes bust then that part of the money is gone. I have things from canabis penny stocks to Shopify to Intel.
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Mndiver
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Re: Bitcoin futures with Fidelity

Post by Mndiver »

whodidntante wrote: Sat Dec 16, 2017 2:12 pm
Mndiver wrote: Sat Dec 16, 2017 2:07 pm I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
Then your best option would be to convert some money into bitcoin, not to buy and roll a futures contract.
At the risk of sounding really ignorant, how do I do that?
Daryl
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Re: Bitcoin futures with Fidelity

Post by Daryl »

whodidntante wrote: Sat Dec 16, 2017 1:57 pm Fidelity does not offer futures.

You can buy futures at other (but not all) discount brokers. TDA, IB, Schwab, ETrade offer futures.

IB does not currently allow shorting bitcoin futures, although you can short other types of futures there. I don't know what other brokers are offering.
TDA will allow Bitcoin futures trading on Monday. The CNBC article wasn't clear if they'd allow both short and long positions, though it did mention higher margin requirements.
Valuethinker
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Re: Bitcoin futures with Fidelity

Post by Valuethinker »

Mndiver wrote: Sat Dec 16, 2017 3:59 pm
whodidntante wrote: Sat Dec 16, 2017 2:12 pm
Mndiver wrote: Sat Dec 16, 2017 2:07 pm I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
Then your best option would be to convert some money into bitcoin, not to buy and roll a futures contract.
At the risk of sounding really ignorant, how do I do that?
Oh welcome to endless threads here and on the net. There's all kinds of issues re what is the most secure way to do this.

Coinbase is apparently the most downloaded iphone Ap at the moment, at least supposedly.
whanaumark
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Re: Bitcoin futures with Fidelity

Post by whanaumark »

Mndiver wrote: Sat Dec 16, 2017 3:59 pm
whodidntante wrote: Sat Dec 16, 2017 2:12 pm
Mndiver wrote: Sat Dec 16, 2017 2:07 pm I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
Then your best option would be to convert some money into bitcoin, not to buy and roll a futures contract.
At the risk of sounding really ignorant, how do I do that?
Head to
https://www.coinbase.com/join/51d4227f9c8c8866fa00000d

Use the link, we both get $10 of bitcoin. Coinbase is the most reputable of online wallets
ny_rn
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Re: Bitcoin futures with Fidelity

Post by ny_rn »

Create an account on coinbase.com and then buy and sell on gdax.com (owned by coinbase) with $0 fees.
skepticalobserver
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Re: Bitcoin futures with Fidelity

Post by skepticalobserver »

How would you price a Bitcoin contract or determine fair value? Is there a uniform spot price? Is settlement in dollars, Bitcoin or what?

The lure of a cryptocurrency is that it’s not one of them fiat currencies. Who’s taking Bitcoin as payment for goods and services? I’ve never seen payment in gold at the Safeway checkout. At the end of the day the hard currency stuff finds its way into dollars, euros, yen, etc. in the course of commerce.

Regardless, the trend is Bitcoin’s friend so put me in for a couple of lots at the opening.
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arcticpineapplecorp.
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Re: Bitcoin futures with Fidelity

Post by arcticpineapplecorp. »

Mndiver wrote: Sat Dec 16, 2017 3:59 pm
whodidntante wrote: Sat Dec 16, 2017 2:12 pm
Mndiver wrote: Sat Dec 16, 2017 2:07 pm I obviously don’t know what I’m talking about. I had just hoped to have a way to throw a couple hundred dollars into Bitcoin somehow and get in on the skyrocketing prices while they last. No idea how to do it.
Then your best option would be to convert some money into bitcoin, not to buy and roll a futures contract.
At the risk of sounding really ignorant, how do I do that?
at a Bitcoin ATM, where else??

https://www.google.com/search?client=fi ... cZe9b_MQKU

well there are other ways to buy them to. usually through a broker, so expect to pay a hefty commission since it's not as liquid as say the total stock market index fund or the S&P500 index fund is.

seriously don't buy bitcoin. you'll only contribute to its rise...which benefits everyone else who bought before you, not you. In order for you to make money, you have to hope someone else is going to buy it at an even higher price than you did. Why would they do that? Come to think of it, why would you buy it at a price higher than others did in the past? It's called the greater fool theory. That makes you the greater fool the moment you buy it at a higher price than it was before. But then you have to hope an even greater fool than you comes along and pays an even higher price than you.
The greater fool theory states that the price of an object is determined not by its intrinsic value, but rather by irrational beliefs and expectations of market participants. A price can be justified by a rational buyer under the belief that another party is willing to pay an even higher price. source: https://en.wikipedia.org/wiki/Greater_fool_theory
https://www.google.com/search?q=greater ... fox-b-1-ab

no offense, but since you're asking such basic questions it's pretty obvious you haven't done your due diligence. People who don't do their due diligence usually lose money. Is that what you want? You're looking to make a quick buck. I get it. Problem is if you're at the poker table and you don't know who the patsy is, it's you.

best of luck though. please do let us know how it goes. especially if it ends badly. then you can perhaps help the next speculators who want to buy in to the next bubble that comes along. we all learn from each other.
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions | Wiki
lack_ey
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Re: Bitcoin futures with Fidelity

Post by lack_ey »

skepticalobserver wrote: Sat Dec 16, 2017 5:34 pm How would you price a Bitcoin contract or determine fair value? Is there a uniform spot price? Is settlement in dollars, Bitcoin or what?
Bitcoins are a liquid asset you can readily trade that have zero holding costs. Futures for these kinds of assets should be relatively close to spot, outside of some weird teething issues early on, when the market isn't that robust. The futures prices should not significantly exceed spot, or else you could short the contracts and own actual bitcoin long for an arbitrage profit. Currently I'm seeing the contracts under spot, with higher values the longer the contract.

These are cash settled. The price used on settlement actually varies between CBOE and CME. Check their docs for further details of how those are determined on expiry.
http://cfe.cboe.com/cfe-products/xbt-cb ... ifications
http://www.cmegroup.com/trading/equity- ... tions.html
skepticalobserver wrote: Sat Dec 16, 2017 5:34 pmThe lure of a cryptocurrency is that it’s not one of them fiat currencies. Who’s taking Bitcoin as payment for goods and services? I’ve never seen payment in gold at the Safeway checkout. At the end of the day the hard currency stuff finds its way into dollars, euros, yen, etc. in the course of commerce.
Dell, Microsoft, Overstock.com, Expedia, Tesla, Newegg, TigerDirect, Steam, a number of smaller services and stores. More outside the US, including international money transfer services. Most just plug into a Bitcoin payment processor like Bitpay. It should be thousands of merchants. Plenty of non-commercial software developers or other net/tech related sites accept Bitcoin donations, just by listing an address on the site people can donate to if they want.

All the huge runoff in prices has made the much of the argument for and utility of Bitcoin evaporate, for what it's worth. One of the arguments used to be that it could facilitate small-dollar transactions well without having to hand over credit card or bank information, be cheaper than credit card processors and the likes of Paypal, etc. But now typical mining fees (to get a transaction through the system and actually added to the ledger in the course of an hour or so, not relying on somebody to do it for free) are above $10 a transaction. I mean, that's still fine for sending significant remittances, black market goods, and money laundering, but it's a problem for many others.
vk_217
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Re: Bitcoin futures with Fidelity

Post by vk_217 »

Bitcoin Investment Trust maybe? https://eresearch.fidelity.com/eresearc ... mbols=GBTC. I started following this when it was at 800 and felt it was too high and wanted to buy if it went to 500.Its 2700 now :(
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dwickenh
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Re: Bitcoin futures with Fidelity

Post by dwickenh »

Let me call the shoeshine guy down at the train station, I am sure he has a connection. :twisted:
The market is the most efficient mechanism anywhere in the world for transferring wealth from impatient people to patient people.” | — Warren Buffett
lack_ey
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Re: Bitcoin futures with Fidelity

Post by lack_ey »

vk_217 wrote: Sat Dec 16, 2017 7:12 pm Bitcoin Investment Trust maybe? https://eresearch.fidelity.com/eresearc ... mbols=GBTC. I started following this when it was at 800 and felt it was too high and wanted to buy if it went to 500.Its 2700 now :(
It's still trading around a 50% premium to NAV and has an ER of 2%. The site says 0.09196847 BTC per share, and the current share price is about $2700 (at the end of Friday trading, so sure, it's stale).

I guess if you want to take a bitcoin-related bet it's an option. There's not a mechanism that can really tie this to NAV so I guess you can hope here for non-price convergence. It's been running the premium for a long time.
workerbeeengineer
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Re: Bitcoin futures with Fidelity

Post by workerbeeengineer »

I am noticing that Bitcoin appears to be trending higher and higher in BH discussions. If even the faithful are taking the time to discuss it, would conclusion should a BH draw?
shades
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Re: Bitcoin futures with Fidelity

Post by shades »

Easiest way I have found is to buy bitcoin investment trust GBTC . There is a pretty hefty premium to bitcoin price built in but it is an easy way to participate.
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ruralavalon
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Re: Bitcoin futures with Fidelity

Post by ruralavalon »

Daryl wrote: Sat Dec 16, 2017 4:33 pm
whodidntante wrote: Sat Dec 16, 2017 1:57 pm Fidelity does not offer futures.

You can buy futures at other (but not all) discount brokers. TDA, IB, Schwab, ETrade offer futures.

IB does not currently allow shorting bitcoin futures, although you can short other types of futures there. I don't know what other brokers are offering.
TDA will allow Bitcoin futures trading on Monday. The CNBC article wasn't clear if they'd allow both short and long positions, though it did mention higher margin requirements.
Wow!!! Bitcoin, futures, and leveraged with high margin requirements :shock: !! What could be better?
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
Valuethinker
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Re: Bitcoin futures with Fidelity

Post by Valuethinker »

ruralavalon wrote: Sun Dec 17, 2017 11:32 am
Daryl wrote: Sat Dec 16, 2017 4:33 pm
whodidntante wrote: Sat Dec 16, 2017 1:57 pm Fidelity does not offer futures.

You can buy futures at other (but not all) discount brokers. TDA, IB, Schwab, ETrade offer futures.

IB does not currently allow shorting bitcoin futures, although you can short other types of futures there. I don't know what other brokers are offering.
TDA will allow Bitcoin futures trading on Monday. The CNBC article wasn't clear if they'd allow both short and long positions, though it did mention higher margin requirements.
Wow!!! Bitcoin, futures, and leveraged with high margin requirements :shock: !! What could be better?
High margin requirements *reduce* leverage.

You post Initial Margin up front. If the futures contract goes against you (price moves up if you are short, down if you are long) then you post more Variation Margin, or the exchange closes out your position at that time (the margin call).

So the higher the Initial Margin, the less the gearing.

For example for some contracts you may be able to get away with $10k on a $100k future contract. That means you could buy 10 contracts with $100k.

If the IM is $50k you could only long 2 contracts - 1/5th as much.
am
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Re: Bitcoin futures with Fidelity

Post by am »

How about this, an index fund of crypto?

https://www.bitwiseinvestments.com/
NYCwriter
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Re: Bitcoin futures with Fidelity

Post by NYCwriter »

Unless you're already an experienced margin and futures trader, I wouldn't bother. If you want to invest in BTC, do so with a recognition of the risk. You can purchase via Coinbase or hold GBTC through a brokerage (Fidelity, TD, etc) --with the caveat that at present the premium is ridiculously high.

BTC: I've held a small crypto portfolio of BTC, ETH, and LTC for more than a year. It was an academic curiosity on what the transactional applications would be, but as I didn't see any potential from its transactional abilities I left it alone. Now I'm following its trajectory with a mixture of amusement and concern. I invested less than <1% of my portfolio, an amount I was willing to lose. I just recently sold a tiny amount to recover my initial investment, and plan to wait a full year from the last date I added to sell more. Calculating tax is a pita, as there's no 1099. The IRS taxes it as property with short (ordinary) and long gains. Even making purchases with BTC involves a tax assessment.

GBTC: I'm a little annoyed at Vanguard for not allowing GBTC purchases when the otc trust became available. I ended up buying some shares in my taxable individual equity brokerage early this year rather than my Vanguard Roth. (FYI: VG now allows purchase but you have to call them first.) Anyway, I'm waiting to sell since it's up so much I have to consider the tax liabilities. I was not expecting it to spike so much.

Would I buy or add now? No. But the caveat is the same: Don't invest more than you're willing to lose.
alex_686
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Re: Bitcoin futures with Fidelity

Post by alex_686 »

As a point, I don't think the margin requirement or the roll requirement for futures is a solid argument. Yes, these would provided a drag - the drag being around the rate of the risk free rate - or short term treasuries.

If you bought Bitcoin outright you would need to pay cash now. You could have invested your cash in something else - like risk free short term treasuries.

That is the actually cost of investing in futures would be equlivent to the lost opportunity cost by investing directly. 6 of one, half dozen of the other. At least assuming that Bitcoin futures work like other commodity futures and I can't see why it would not.
Former brokerage operations & mutual fund accountant. I hate risk, which is why I study and embrace it.
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