Rewards Hub 
TradFi futures let you trade price movements of stocks, indices, and precious metals. They do not make you a shareholder, they do not pay dividends, and they do not follow stock exchange hours. Before opening a position, it helps to understand exactly what you are trading and what assumptions do not apply.
The mechanics are simple once you separate the product from the expectations people often bring from traditional investing.
What TradFi Futures Actually Are
TradFi futures are derivative contracts that track the price of traditional financial assets.
When you trade a Tesla TradFi futures contract, you are speculating on whether Tesla’s stock price will rise or fall.
Your profit or loss comes from the difference between your entry and exit price. The contract references Tesla’s price, but no Tesla shares are involved.
This is the same structure as BTC/USDT perpetuals. When you trade Bitcoin futures, you are not buying Bitcoin. You are trading a contract that tracks Bitcoin’s price. TradFi futures apply the same logic to stocks, indices, and commodities.
This distinction matters, because everything else flows from it.
Myth: Trading Stock Futures Means Owning Stock
Reality: You own nothing.
When you buy Apple stock through a brokerage, you become a partial owner of Apple Inc. You hold shares, appear on a shareholder register, and have legal ownership rights.
When you trade Apple TradFi futures, none of that happens. You do not own shares. You do not own a fraction of the company. You hold a contract that settles based on price movement, and nothing more.
This is not a technical detail. Stock ownership is an investment in a company. Futures trading is speculation on price direction.
Myth: I'll Receive Dividends on Stock Futures
Reality: Futures do not pay dividends.
Dividends are paid to shareholders. If you own Apple stock on the dividend record date, you receive the dividend. If you trade Apple futures, you do not.
The company does not know you exist. You are not a shareholder. You are trading a derivative contract on a crypto exchange.
Dividend announcements can affect the stock price, and that price movement may be reflected in futures pricing. But there is no separate dividend payment to futures traders.
Myth: I Get Voting Rights and Shareholder Benefits
Reality: You have no corporate rights.
Shareholders can vote on board elections and major corporate actions. They receive annual reports and proxy materials. They can attend shareholder meetings.
Futures traders receive none of this. Holding a Tesla futures contract does not give you voting rights. Trading Apple futures does not put you on a mailing list. The company has no relationship with you.
If you are looking for ownership or long-term participation in a company’s growth, TradFi futures are not the right tool.
Myth: TradFi Futures Follow Stock Exchange Hours
Reality: Futures trade on their own schedule.
The NYSE opens and closes at fixed times. If you own Apple shares, you can only trade during those hours.
TradFi futures do not trade on the NYSE. They trade on the platform that lists them. On Phemex, that means 24/7 access.
You can open or close positions on weekends, holidays, or in the middle of the night. This flexibility is one of the main differences between futures and spot stock trading.
It also means you are operating in a different market with different conditions.
Myth: TradFi Futures Are Just Like Buying Stocks with Leverage
Reality: The risk profile is fundamentally different.
Yes, both involve exposure to stock price movements. Yes, both can make or lose money. But the mechanics create fundamentally different risk profiles.
Stocks have no expiration. You can hold Apple shares for 50 years. If the price drops, you can wait for recovery. Time is on your side.
Perpetual futures have funding rates. Holding a position costs money over time. If you're on the wrong side of the funding rate, you pay to maintain your position indefinitely.
Stocks have limited downside. If you buy $1,000 of Apple stock, you can lose $1,000 maximum (if Apple goes to zero, which is unlikely).
Leveraged futures can exceed your margin. With 10x leverage, a 10% adverse move wipes out your entire position. Depending on platform mechanics, losses can compound quickly.
Stocks settle in your brokerage account. Futures settle in USDT on a crypto exchange.
Calling TradFi futures "leveraged stocks" misses these structural differences. They're different products designed for different purposes.
Myth: 24/7 Trading Means 24/7 Liquidity
Reality: Liquidity changes throughout the day.
When traditional markets are closed, reference prices are not actively discovered in spot markets. As a result, spreads can widen, order books can thin, and price moves can become sharper.
The market remains open, but conditions are not the same as during peak trading hours. Experienced traders account for this. New traders often overlook it.
Myth: TradFi Futures Are a Shortcut to Stock Market Exposure
Reality: They are a different product.
TradFi futures provide price exposure, not investment exposure. They do not offer ownership, dividends, voting rights, securities regulation, or long-term holding without cost.
They are designed for active trading, not passive wealth building.
If your goal is to speculate on price movements with leverage and react to news outside market hours, TradFi futures make sense. If your goal is long-term ownership and income, they do not.
What TradFi Futures Are Good For
TradFi futures are useful when expectations are set correctly.
They work well for short-term directional trades, reacting to earnings or macro news, and trading outside traditional market hours.
They also allow traders to diversify exposure without opening brokerage accounts or moving funds between platforms. One account, one balance, one interface.
These advantages are real. They simply belong to derivatives trading, not stock ownership.
Frequently Asked Questions
Can I convert my TradFi futures position into actual stock?
No. There is no conversion mechanism. Futures positions settle in USDT. If you want to own actual shares, you need a separate brokerage account.
Do stock splits or corporate actions affect my futures position?
Price adjustments from corporate actions are typically reflected in the futures contract price. However, you don't receive the actual benefits (like additional shares from a split) because you don't own shares.
What happens if a company I'm trading goes bankrupt?
The futures contract would reflect the stock price decline. You could profit if short, lose if long. But unlike shareholders, you have no claim on corporate assets in bankruptcy — you never owned anything to begin with.
Are TradFi futures regulated like stocks?
No. TradFi futures on crypto platforms operate under different regulatory frameworks than securities traded on stock exchanges. The protections and requirements differ significantly.
Should I use TradFi futures for retirement investing?
No. Retirement investing typically involves long-term holding, dividend reinvestment, and ownership of appreciating assets. TradFi futures are designed for active trading and speculation, not passive wealth building.
Key Takeaways
TradFi futures are derivative contracts, not stocks. They offer price exposure with leverage and 24/7 access, but they do not provide ownership, dividends, or shareholder rights.
Understanding what they are, and what they are not, helps avoid confusion and mismatched expectations.
Trade them as trading instruments, not investments.
TradFi futures are leveraged derivative products. They do not confer ownership, dividends, or shareholder rights. Price fluctuations may result in significant losses. This article is for educational purposes only and does not constitute financial advice. Please evaluate your risk tolerance before trading.
