Stellar Lumen Futures is an agreement between two parties to buy or sell Stellar Lumen at a predetermined future date and price. The futures contract derives its value from the underlying cryptocurrency, Stellar Lumen in this case. Thus the price of a Stellar Lumen futures contract moves broadly in sync with the price of Stellar Lumen.
Trading futures is thus an alternative to actually buying or selling the underlying crypto (aka spot trading). In spot trading, you can make profit by buying Stellar Lumen low and selling it at a high price. This trade however works only in a bull market, i.e. when Stellar Lumen price is going up. However, in a bear market, there is no trade possible in spot trading. Furthermore, leverage trading is not possible in spot trading.
Trading Stellar Lumen through futures offers several advantages over spot trading of Stellar Lumen, namely ability to both long or short and get access to leverage.
Trade profitably in all market conditions
Hedge Price Risk
If you are a HODLer, you can still use futures to mitigate price risk. Say, you hold XLM. You can mitigate the risks you face when Stellar Lumen is falling by going short XLM futures. In this case, a short futures position acts as a downside protection by effectively locking the $ value of your portfolio without the need for selling your Stellar Lumen. Judicious use of futures as hedge can make you a better and stronger HODLer.
Amplify trading gains with leverage