London Gold falls under the international spot gold trading system, while COMEX Gold Futures are standardised futures contracts. Both are commonly quoted in US dollars per troy ounce, and the standard contract size for both is 100 ounces. However, they differ in expiry rules and market structure.
Why Do Futures Have Contract Months?
A futures contract stipulates trading and delivery for a future date, which is why different expiry months are listed. Traders must confirm which monthly contract they are trading and keep track of the last trading day and contract rollover.
London Gold Has No Monthly Expiry Like Traditional Futures
London Gold functions more like a continuous spot quote. Traders mainly focus on daily trading hours, settlement and holding charges. Its price chart therefore appears continuous, yet holding positions over time still incurs relevant costs.
Why Are Their Prices Similar But Not Identical?
Futures prices factor in time to expiry, interest rates, carrying costs and market supply and demand. Spot and futures prices are usually highly correlated, though they do not need to match exactly at every moment.
Margin Rules Also Differ
Futures margin is adjusted under rules set by the futures exchange and brokerage framework. London Gold accounts follow the margin policy specified by the respective broker. Do not assume margin and stop-out rules are interchangeable just because both products are labelled “100 ounces per lot”.
What Should New Traders Check First?
Start by confirming the product name, contract month, expiry status, trading hours and fees. Failing to distinguish spot from futures will easily lead to confusion in subsequent price analysis.
The Most Obvious Distinction: Futures Have Defined Contract Months
COMEX Gold Futures are listed by individual calendar months. Traders buy a standardised futures contract for a specific expiry month. As expiry approaches, traders need to close the position, roll it to a later-dated contract, or arrange delivery in line with exchange rules.
London Gold does not have this fixed monthly expiry structure. Positions may be held continuously subject to platform rules, but overnight holding will incur swap charges.
Quotes Are Highly Correlated But Not Identical
Futures prices incorporate funding costs, delivery timing and the market’s forward pricing expectations, whereas London Gold closely tracks international spot gold pricing. Near-month futures generally move alongside spot gold, though they may trade at a premium or discount.
Therefore, when financial news references “COMEX Gold”, do not treat that figure as the executable price for your London Gold trades.
Contract Size and Minimum Trading Increments Differ
Lucky Gold’s London Gold contract is 100 ounces per lot, with a minimum trade size of 0.01 lot. COMEX standard gold futures follow exchange-defined contract specifications, and micro contracts and other variants are also available. Lot sizing and margin rules for the two instruments cannot be directly swapped.
For retail traders, London Gold allows position scaling with smaller lot sizes, while futures trading must adhere to the formal specifications of the selected futures contract.
Cost Structures Are Different
London Gold trading costs mainly consist of floating spreads and overnight swaps. Futures costs typically include brokerage commissions, bid-ask spreads, exchange fees and rollover expenses. If you plan to hold positions for weeks or months, both futures rollover costs and London Gold swap charges should be calculated in advance.
How to Interpret News of a “Sharp Rally in Gold Futures”
It serves as a useful reference for sentiment and price discovery across the global gold market. Nevertheless, when trading London Gold, you should rely on live London Gold bid and ask quotes. The two markets often trend together, but not every price tick aligns perfectly.
Futures Rollover Affects Long-Term Holding Outcomes
When holding a futures contract approaching expiry and you do not intend to take delivery, you normally close the near-month contract and open a position in a deferred contract. Prices can differ between the two contracts, and rollover creates spread exposure plus transaction costs. London Gold has no mandatory expiry rollover, yet overnight swaps apply for positions held across trading days. Both instruments carry ongoing holding costs for long-term trades, just in different forms.
Risk Warning: Both futures and London Gold involve leverage, and loss risks increase with position size.