Speculating about the future is not real property contracts rather speculate about the product is marketed as a value. Every futures contract includes a buyer and seller. The following is an example of a futures speculation: A farmer agrees to deliver 1,000 tons of corn to a baker at a price of $ 5.00 per bushel. If the daily price of corn futures fell to $ 4.00 per bushel, farmers account credited with $ 1,000 ($ 5.00 - $ 4.00 per 1,000 bushels) and the baker's account is charged the same amount. Deposit accounts completed each day.
Using this as an example here is how the completion of a contract to play for: If the price of corn futures is still at $ 4.00 the farmer will make $ 1000 in the futures contract and the baker had lost the same amount. However, the baker can now buy wheat on the open market at $ 4.00 per bushel - $ 1000 less than the original contract, so the amount lost in the futures contract is formed by the lower cost of corn. In addition, farmers had to sell grain on the market opened at a cost of $ 4.00 per bushel, less than he expected when entering the futures contract, but the profits generated by the futures contract is the difference.
Speculators profit by daily fluctuations in futures markets choose to buy the seller (buying short-term) or the buyer (buying long).
The foreign exchange market has advantages over the futures market. FOREX is the largest financial market in the world. It is a liquid market and stop orders can be implemented more easily and with less slippage in other markets. Forex market is open 5 days a week, 24 hours a day. Operators can take advantage of opportunities as they become available. Foreign exchange transactions are usually instantly executed. Foreign currency transactions are commission free. Agents make money on the spread.
Some investors believe that because of the construction ensures that Forex is safer than futures.
Posts
Post a Comment