Less margin: because of the lower volatility, the exchanges set margin requirements for many futures trading spreads that can be much less than an outright futures position. But, why bother educating one's self on the inner workings of futures trading spreads?

What advantages come with lower volatility and lower margins? Those qualities by themselves don't very strongly suggest futures spread trading is worth pursuing. Well, consider this: those same large speculators and commercial firms who regularly employ spreads - again, some of the most invested and arguably the most sophisticated players in futures trading - are often employing spreads based on market conditions and events that recur at periodic intervals.

Maybe the most obvious of these intervals is the cycle of weather from warm to cold and back to warm. For agricultural and energy futures markets, weather - more accurately the seasons - can have an important effect on price movement.

For example, enormous supplies of soybeans, once harvested, dwindle throughout the year. The same goes for other agricultural commodities such as wheat, corn, sugar, and cotton. Seasons and weather changes affect energy prices as well.

Demand for heating oil typically rises as cold weather approaches but subsides as refiners meet the anticipated demand. Memorial Day typically marks the beginning of the "driving season" in the United States and similarly, a vast number of the rest of the world's population prepares to "go on holiday. Seasons and weather changes aren't the only cycles affecting the markets. Cycles in the financial arena can affect related futures trading markets. Consider how a nation's fiscal year and tax due date is often at variance with others who are important trading partners.

That can influence currency flows and the forces on interest rate-sensitive instruments. Spread trades can take advantage of these types of cycles. Consider this: Market-driven U. And how that spread found itself into this article leads me to the heart of the article: where can you find out more information about futures spread trading? They may be harder to find, but there are some very good sources of research on futures spreads available for your investigation.

My personal favourite is Moore Research Center, Inc. They're responsible for the description and record keeping of the interest rate spread I just cited. Although spread Futures Trading in Macon GA represents an important slice of the overall trading volume in the futures markets - and is used as a futures trading strategy by some very sophisticated participants, I see it as an approach worthy of investigation by futures traders more broadly, including most of our readers.

Even if spread trading futures can take on the directional characteristic of straight futures trading, it is certainly an overall different approach and that can be the trading futures strategy diversification you're looking for. As is always the case when we share trade proposals of this sort, we want to make sure we square up our discussion with the always-important information.

Spread trading like all futures trading, isn't without its risks. Even with regard to the annual cycles referenced above, which will inevitably ebb and flow both daily and longer term - no spread works every time.

Just look at how some summers are hotter and dryer - and at more critical times - than others for an example of what can affect a grain, livestock, energy, possibly even another type of futures trading spread.

Make sure you're aware of the risks to trading futures spreads as you should with any futures trade. A spread usually comprises of multiple futures related positions. If we have to recognize the spread for margin purpose, there needs to be an economic connection between its constituents. Gold and silver are fellow travelling precious metals; however, formally recognizing the spread by exchanging clearing house is needed if we have to derive the spreads benefits.

In most of the cases, the benefit is reduced margin requirements. Selling Gold against Silver purchase wagers on an improvement in silver's buying power, whether it derives from a rise in silver's price or a decline iThere is a variety of "Spread Trading Software" that can help you analyze your trading needs gold's.

A spread, therefore, gives you an opportunity to profit regardless of overall market direction. The price of crude oil is a vital global economic factor. This means that day trading is often influenced by political and commercial concerns. If the price of oil remains high over a period of time, cost of products like fertilizers and plastics are also inadvertently affected.

Crude oil futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of crude oil e. Wheat futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of wheat e. Producers and consumers of wheat can manage wheat's price risk by buying or selling wheat futures.

Producers can deploy a short hedge to lock in selling price for the wheat they produce while the businesses that require the wheat can make use of long hedge to secure a purchase price for the commodity needed.

There is a variety of "Spread Trading Software" that can help you analyze your trading needs. Trading is truly a fascinating pursuit. The markets can in still excitement, frustration, irritation, exhilaration - really a wide range of emotions - conceivably, even within a single trade. Trading is definitely one of those undertakings where one has to constantly study, evolve and grow. There are also a number of different approaches to trading, including day trading, swing trading and position trading.

One narrowly defined approach to trading - probably most relevant for day traders - is trading around economic reports. The release of economic reports occurs almost daily. Most come from the U. federal government and look at national or large regional data; some come from other private surveys.

Some garner considerable attention by traders; others draw barely a thought, much less a glance at their impact on the markets. This article doesn't attempt to detail any particular number of them and their significance. Rather, it lists some pointers that can help traders prepare for reports releases. This helps to eliminate some, but not all, of the prevailing price risk facing commodity producers.

It also helped to build a more liquid market environment for the commodity producers themselves. Again, before the creation of the commodity futures trading markets , contracts were drawn up between the two parties specifying a certain amount and quality of a commodity that would be delivered in a particular month these were known as forward contracts and were not the standardized commodity futures trading contracts we know today.

In , a central dealing facility was opened in Chicago, USA where farmers and dealers could deal in 'spot' grain, i. Commodity Futures Trading evolved as farmers and dealers committed to buying and selling futures contracts of the underlying commodity. Perhaps surprisingly, until only about forty years ago, trading futures markets consisted of only a few commodity farm products, however, now they have been joined by a huge number of tradable financial and other tradable products such as precious metals like gold, silver and platinum; livestock such as hogs and cattle; energy contracts such as crude oil and natural gas; foodstuffs like coffee and orange juice; and industrials like lumber and cotton.

Trading commodity futures and options involves substantial risk of loss. The recommendations contained in this letter are of opinion only and do not guarantee any profits. These are risky markets and only risk capital should be used. Past performance is not necessarily indicative of future results. For beginners, futures traders can also check detailed comprehensive trading futures market insights and strategies in commodity futures trading through our educational resources, articles, other Beginner's Guide To Trading Futures which are mentioned below:.

The risk of loss in futures trading can be substantial, carefully consider the inherent risks of such an investment in light of your financial condition. Of course, these are just some of the commodity futures contracts traded every day — on some of the oldest and largest exchanges in the world. Treasury bonds, yr.

T-notes , currencies i. Compared to the majority of assets you can trade, futures contracts have particular feature to them. This involves the means by which futures contracts are traded. Instead of requiring a financial commitment equal to the value of the asset, for futures contracts only a fractional commitment is required. This is the concept of leverage.

For example, the standard futures contract available for trading gold is equal ounces of the metal. However, it is allowable to enter a position in gold futures for a fraction of that.

The effect of leverage is that a change in the price of one hundred ounces of gold results in a magnified change in the value of the leveraged futures contract. This magnifying effect on the price change of an asset sets futures trading apart from most other types of trading. Another important difference in Futures Trading in Macon GA is that buying futures — expecting a price increase, or selling futures — expecting a price decrease, are equally allowable with the same margin requirement.

In other words, taking a long or short position in the market provides equal opportunity and equal risk. And trading futures not only calls for an understanding of the rewards and risks involved, it requires a trading account. Whether you choose to open a self-directed futures trading account, or one where a broker supports you in your trading — in some large or small way — there are several important factors you should consider.

You might want to consider the features of your trading platform i. There are three fundamental strategies that futures traders employ: going long, going short, and spreads. Learning them can help a novice investor become successful when engaging in commodities. Education in the various aspects of the industry is necessary in creating profits and avoiding financial loss. When going long, a trader buys a contract in the hope that the value will increase in the future.

He keeps the contract for a relatively long period in anticipation of a favorable price change. When going short, the investor is betting on the opposite. The commodity will decline in price as time passes.

He sells or shorts the futures contract when the price is currently high and usually seeks to buy it again at a lower price point in the coming months. Long and short positions involve buying or selling futures contract to take advantage of price fluctuations. Unfortunately, no one can accurately predict the future and the risks are large.

Spreads can reduce the uncertainty; instead of entering into a single futures contract, investments are spread into multiple contracts with contrary positions. Calendar spreads are an example of this type of strategy, and involve the simultaneous purchase and sale of two contracts of a single commodity with different delivery dates.

Investors seek a profit from the difference between the two positions. For new investors, going long, short, or trading in spreads can be a confusing experience. Fortunately, novices can seek advice from a broker. The broker can recommend different strategies and types of spreads, which an investor can adopt until he learns to create his own personal trading strategies.

The broker can also recommend tools, such as trading software, which will help an investor analyze market trends and the behavior of various commodities. One of the ways a broker might recommend that commodities traders minimize the risks involved when dealing in commodities futures is to engage in futures options trading. Unlike a straight futures contract, a futures option gives the trader the right to buy or sell a commodities contract at a predetermined price.

Trading in futures options is an effective strategy to limit risk and leverage. When a trader purchases a futures option, his losses are limited to the price paid for the option. On the other hand, it allows the trader to control a more expensive asset or commodity without having to purchase it outright, as is the case in a conventional futures contract. There are two types of options available: "call," and "put. Essentially, the options holder has right to buy or sell, while the other party has the obligation to buy or sell.

Call and put options can be exercised by the options holder before, or even during the contract expiration date. Buying call options is a good move for traders who believe that the price for a particular commodity will rise within a certain period.

Because they can choose not to exercise their right to buy, or exit the option before the contract ends, they run a much lower risk compared to a straight futures contract. This is also true for traders buying Put options. If the price of a commodity falls below a certain strike price, they have the right to sell their commodity futures contract to a seller with minimal loss on their end. While futures trading options can help minimize trade risks, it's important to remember that on its way, options trading can still lead to a loss, particularly if a trader doesn't use any other strategies to complement their trading.

In order to be in a better position to profit from the commodities market, it's important to do keep updated on emerging market trends and events. Understanding the basics of futures trading enables new investors to increase their chances of earning. Premium and discount futures are brokers' terms which describe the state of a particular futures contract.

When a future is at a premium or a discount, an investor can use an appropriate strategy to maximize gains. Premium and discount futures describe the relationship of a commodity's price with the spot price.

The futures' price is the expected cost of the contract when it matures, while the spot price refers to the cost of the contract on the exact moment of trade or "on the spot. When the spot price is lower than the futures' price, it's termed a premium future. When the opposite occurs and the spot price is higher than the futures' price, then it's a discount future. This situation can also be called a contango, while the opposite can be referred to as backwardation.

When a future is at a premium, it generally indicates near-term demand. It is likely that it will trade higher in the coming trading sessions. Premium futures offer a buying opportunity, especially when an investor takes a long position. This situation can normally be found for non-perishable commodities with a cost of carry.

At the other end, discount futures indicate that supply is greater than demand. The market will probably correct itself soon, and a wise investor must be prepared to short sell. While these general strategies are effective, the trick in maximizing earning potential lies in knowing when to exactly buy or sell. Some traders trade these vehicles extensively because of the greater potential for leverage than could be garnered by trading these instruments outright on the world's equity markets.

Leverage in the futures trading markets is denoted by the substantial position that can be initiated in an underlying commodity while putting up a relatively small amount of cash margin. A trader or speculator needs to be aware of the double-edged sword this implies: while the potential for greater profits exists, so does the increased risk of very large losses in the commodity futures markets.

The understanding of leverage and the risks that inherently come with it, is paramount before initiating any positions in the commodity futures markets. No one can claim to know how Futures Trading in Macon GA works without a firm mental grip on these important futures trading basic mechanics.

For beginners, the term contract can, at first glance, seem cold and uninviting, but it is consciously used because, like any other legal binding contract, a futures investment has an expiration date and standardized features. You don't have to hold the contract until it expires. You can cancel it or offset your position any time you would like before expiration of the contract.

In fact, many short-term traders, known as day traders, only hold their contracts for a few hours - or even just for minutes! The expiration dates for various futures contracts vary between commodities, and you have to choose which markets and futures contracts fit with your Futures Trading in Macon GA objectives. As a general commodities futures trading rule, the nearer to expiration contracts are usually more liquid, i. there are more traders trading them and there is inherently more trading volume therein, which is referred to as liquidity.

The limitation on the number of contracts you can trade within reason - there must be enough buyers or sellers to trade with you is governed mainly by your account balance and the amount of Futures Trading in Macon GA margin you can bring to the markets.

may trade thousands of contracts at a time in different futures trading markets. These larger positions must adhere to CFTC position limits and reportable position rules. As outlined above, all futures contracts are standardized, in that they all hold a specified amount and quality of a commodity.

For example, a Silver SI futures contract holds 5, troy ounces of silver, a Gold futures contract GC holds troy ounces of 24 carat gold; and a Crude Oil CL futures contract holds barrels of crude oil of a certain quality that is standardized and specified in the futures contract itself.

Before you get started Futures Trading or Commodities Trading , make sure you educate yourself with trading futures beginners guide, learn an online commodity futures trading platform , and get to a known commodities broker. Download a free futures trading software from Cannon Trading. So you've come this far. You've evaluated different vehicles of investment, and you have decided to expand your portfolio to include commodity futures trading, Now what?

You are going to need a few tools at your disposal: a knowledgeable commodity broker that is quick on their feet, a reliable, efficient platform that will get you the information you require and executes your trades on a timely basis, and perhaps most importantly a commodity futures trading plan.

One of the most difficult aspects of futures trading is coming to terms with one's own skill set; what are the characteristics of my trading? What are the flaws and finer points of my trading? Our future brokerage firm has been in the same location in Beverly Hills, California since and has the experience and tools to help you achieve your trading futures goals. We offer most of the platforms available in the industry today and it affords us the opportunity to provide an objective, comprehensive point-of-view when helping you choose your execution platform.

Whether it is the user-friendly nature and execution of the Firetip platform , the indicator-specific trading of the SierraCharts platform, or the automated risk management feature of TransAct AT , we can assist you figure out what it is that you need to help you increase your chance of success. Every platform is different, even if they look similar. Depth of Market DoM trading has many subtle differences between platforms, and we're more than happy to share which ones we think are best.

Also, the markets you're trading are very important to the platform you are going to be executing on; for example, some platforms we offer are not capable of trading Options on Futures or Forex, while some platforms we carry can handle it all. Some platforms are capable of trading Asian markets, while some platforms deal only with a handful of markets. Again, this is where talking to one of our brokers comes in handy. Navigating the Futures Trading in Macon GA markets is not understood overnight.

It can often take years of preparation and research, and you can never learn enough patience when you're trading live. Just as paramount as any other prerequisite for trading futures is a proper commodities futures trading psychology : one that will allow you to determine the difference between pain tolerance and denial, between responsible targets and greed, and a mindset that won't force you to keep trading when it's time to step away from the computer.

There are many commodity futures trading strategies that can be employed; several of these methods and brief descriptions can be found below:. Spread Trading - A type of trade where a single position in the market consists of the simultaneous purchase of one futures contract and sale of a related futures contract as a unit.

Options on Futures - The purchase or sale of derivative instruments that grant the trader the right, but not the obligation to execute a trade on underlying futures contracts. Day Trading - Day trading consists of entering futures positions and exiting those same positions within the course of one day's session. Position Trading - Denotes holding a position for a longer period of time that may involve hours, or even a few days or longer.

Scalping - Scalping involves the very fast execution of trades in hopes of taking advantage of small and frequent price changes. Swing Trading - Swing trading is a type of position trading that attempts to capture potentially larger price movements than those involved in quick scalping futures trading strategies. The goal is to establish a position as price breaks out of this trading channel concurrent with a spike in open interest, thereby taking advantage of the increase in volatility and catching a strong trend move.

From candlestick formations to the commodity channel index, from condors to turtle trading, there's an enormous catalog of tools and methods available for traders to consider. One method I have noticed is surprisingly under represented among retail traders is futures spread trading, where a single position in the market consists of the simultaneous purchase of one futures contract and sale of a related futures contract as a unit.

I call it surprising because some of the most invested players in Futures Trading in Macon GA - and arguably the most sophisticated - include large speculators and commercial firms who regularly employ spreads. This includes traders in the markets who often actually buy and sell the physical commodities we trade. Farmers, ranchers and other food growers along with food producers, petroleum companies who either drill for oil or natural gas or refine these products - or both, financial institutions with enormous holdings in treasuries, equities or currencies, mining interests and their buyers - all these areas of production and distribution employ Futures Trading in Macon GA spreads from time to time as an important aspect of their businesses.

Indeed, spread trading futures is a fundamental and essential part of the commodities futures markets. At the same time, despite the remarkable increase in interest and in the growth in the volume of the futures markets over the years, spread trading is typically dismissed by most other traders in search of a Futures Trading in Macon GA strategy.

With so much attention focused on other approaches related to straightforward directional trading and within that category, day-trading it's not difficult to see how spread trading futures can be overlooked. Spread trading futures can also be challenging to figure out anyway.

On the surface, buying July soybeans and selling November soybeans, for example, might look like a downright futile endeavor. Lower Volatility: many futures contracts can be extremely volatile, not just during their U. daytime trading hours, but during those night time hours when the preferred activity for many traders is sleep - and futures trading volume can be greatly reduced. Certain types of spreads can greatly reduce volatility risk for futures positions and be a viable substitute for placing stop orders.

In this case, a spread might enable you to withstand the "surprises" that often appear when you rise to a new day. Less margin: because of the lower volatility, the exchanges set margin requirements for many futures trading spreads that can be much less than an outright futures position. But, why bother educating one's self on the inner workings of futures trading spreads? What advantages come with lower volatility and lower margins? Those qualities by themselves don't very strongly suggest futures spread trading is worth pursuing.

Well, consider this: those same large speculators and commercial firms who regularly employ spreads - again, some of the most invested and arguably the most sophisticated players in futures trading - are often employing spreads based on market conditions and events that recur at periodic intervals. Maybe the most obvious of these intervals is the cycle of weather from warm to cold and back to warm. For agricultural and energy futures markets, weather - more accurately the seasons - can have an important effect on price movement.

For example, enormous supplies of soybeans, once harvested, dwindle throughout the year. The same goes for other agricultural commodities such as wheat, corn, sugar, and cotton. Seasons and weather changes affect energy prices as well. Demand for heating oil typically rises as cold weather approaches but subsides as refiners meet the anticipated demand. Memorial Day typically marks the beginning of the "driving season" in the United States and similarly, a vast number of the rest of the world's population prepares to "go on holiday.

Seasons and weather changes aren't the only cycles affecting the markets. Cycles in the financial arena can affect related futures trading markets. Consider how a nation's fiscal year and tax due date is often at variance with others who are important trading partners. That can influence currency flows and the forces on interest rate-sensitive instruments.

Spread trades can take advantage of these types of cycles. Consider this: Market-driven U. And how that spread found itself into this article leads me to the heart of the article: where can you find out more information about futures spread trading?

They may be harder to find, but there are some very good sources of research on futures spreads available for your investigation. My personal favourite is Moore Research Center, Inc. They're responsible for the description and record keeping of the interest rate spread I just cited. Although spread Futures Trading in Macon GA represents an important slice of the overall trading volume in the futures markets - and is used as a futures trading strategy by some very sophisticated participants, I see it as an approach worthy of investigation by futures traders more broadly, including most of our readers.

Even if spread trading futures can take on the directional characteristic of straight futures trading, it is certainly an overall different approach and that can be the trading futures strategy diversification you're looking for. As is always the case when we share trade proposals of this sort, we want to make sure we square up our discussion with the always-important information.

Spread trading like all futures trading, isn't without its risks. Even with regard to the annual cycles referenced above, which will inevitably ebb and flow both daily and longer term - no spread works every time. Just look at how some summers are hotter and dryer - and at more critical times - than others for an example of what can affect a grain, livestock, energy, possibly even another type of futures trading spread.

Make sure you're aware of the risks to trading futures spreads as you should with any futures trade. A spread usually comprises of multiple futures related positions. If we have to recognize the spread for margin purpose, there needs to be an economic connection between its constituents. Gold and silver are fellow travelling precious metals; however, formally recognizing the spread by exchanging clearing house is needed if we have to derive the spreads benefits.

In most of the cases, the benefit is reduced margin requirements. Selling Gold against Silver purchase wagers on an improvement in silver's buying power, whether it derives from a rise in silver's price or a decline iThere is a variety of "Spread Trading Software" that can help you analyze your trading needs gold's.

A spread, therefore, gives you an opportunity to profit regardless of overall market direction. The price of crude oil is a vital global economic factor. This means that day trading is often influenced by political and commercial concerns. If the price of oil remains high over a period of time, cost of products like fertilizers and plastics are also inadvertently affected.

Crude oil futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of crude oil e.

Wheat futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of wheat e.

Producers and consumers of wheat can manage wheat's price risk by buying or selling wheat futures. Producers can deploy a short hedge to lock in selling price for the wheat they produce while the businesses that require the wheat can make use of long hedge to secure a purchase price for the commodity needed. There is a variety of "Spread Trading Software" that can help you analyze your trading needs. Trading is truly a fascinating pursuit. The markets can in still excitement, frustration, irritation, exhilaration - really a wide range of emotions - conceivably, even within a single trade.

Trading is definitely one of those undertakings where one has to constantly study, evolve and grow. There are also a number of different approaches to trading, including day trading, swing trading and position trading. One narrowly defined approach to trading - probably most relevant for day traders - is trading around economic reports.

The release of economic reports occurs almost daily. Most come from the U. federal government and look at national or large regional data; some come from other private surveys. Some garner considerable attention by traders; others draw barely a thought, much less a glance at their impact on the markets. This article doesn't attempt to detail any particular number of them and their significance. Rather, it lists some pointers that can help traders prepare for reports releases. This helps to eliminate some, but not all, of the prevailing price risk facing commodity producers.

It also helped to build a more liquid market environment for the commodity producers themselves. Again, before the creation of the commodity futures trading markets , contracts were drawn up between the two parties specifying a certain amount and quality of a commodity that would be delivered in a particular month these were known as forward contracts and were not the standardized commodity futures trading contracts we know today.

In , a central dealing facility was opened in Chicago, USA where farmers and dealers could deal in 'spot' grain, i. Commodity Futures Trading evolved as farmers and dealers committed to buying and selling futures contracts of the underlying commodity. Perhaps surprisingly, until only about forty years ago, trading futures markets consisted of only a few commodity farm products, however, now they have been joined by a huge number of tradable financial and other tradable products such as precious metals like gold, silver and platinum; livestock such as hogs and cattle; energy contracts such as crude oil and natural gas; foodstuffs like coffee and orange juice; and industrials like lumber and cotton.

Trading commodity futures and options involves substantial risk of loss. The recommendations contained in this letter are of opinion only and do not guarantee any profits. These are risky markets and only risk capital should be used. Past performance is not necessarily indicative of future results. For beginners, futures traders can also check detailed comprehensive trading futures market insights and strategies in commodity futures trading through our educational resources, articles, other Beginner's Guide To Trading Futures which are mentioned below:.

The risk of loss in futures trading can be substantial, carefully consider the inherent risks of such an investment in light of your financial condition. Of course, these are just some of the commodity futures contracts traded every day — on some of the oldest and largest exchanges in the world.

Treasury bonds, yr. T-notes , currencies i. Compared to the majority of assets you can trade, futures contracts have particular feature to them. This involves the means by which futures contracts are traded.

Cannon Trading is a full service and discount online futures trading brokerage firm located in Beverly Hills , California since We provide futures, commodities and options trading access to all US futures exchanges and many international exchanges.

A commodity futures contract is an agreement between a buyer or end user, and a seller or producer to make or take delivery of a Commodity or Financial Futures contract of an Exchange traded contract of a specific size, grade and quality at an agreed upon price for a specific date in the future.

Commodities are bought and sold, therefore they are traded. The exchange where the contract is traded is between the two parties and guarantees the transaction is honoured by those involved. Many of those in the investment world are well-versed in Stock and Bond investing, but when it comes to Commodities investing many of those individuals are not clear as to what Commodities are, even though they come in contact with Commodities on a daily basis to power our vehicles and our bodies as well as providing clothing and shelter.

Most people use or consume commodities on a daily basis, yet when it comes to investing or trading, they ask, "What is Commodities Trading in Macon GA? The short description is that commodities are the raw materials, ingredients or components of almost everything we consume or use in our everyday life. Some of the most actively traded commodity trading futures are: corn, wheat, soybean, gold, silver, copper, oil, gas, cattle, sugar, coffee, hogs, cocoa, and cotton.

Commodities Trading in Macon GA began in the late 's with floor trading of traditional agricultural commodities such as grains, livestock, butter and eggs.

Initially, the transactions rarely involved futures contracts because at the time, commodities were traded as soon-to-be consumed goods. As the market place evolved, it expanded to include financial contracts such as government-backed securities, foreign currencies, metals, energies and equity indexes.

The term "commodity trading futures" addressed the mix of contracts traded on the present day exchanges, all of which are also traded electronically. What appeared to be unbridled chaos on the trading floor, or pits, as price discovery and transactions were conducted via open-outcry, gave way to electronic trading - the matching of bids and offers by exchanges such as the Chicago Mercantile with its ground breaking clearing mechanism, called Globex.

The need for controlling risk for farmers, ranchers, bankers, multi-national corporations, even the Federal Reserve Bank and the Treasury Department themselves has grown along with the role of the speculator to absorb that risk and provide much needed liquidity to the marketplace.

It used to be that pit traders enjoyed an edge by standing where price discovery was happening. The evolution of electronic trading - "trading from the screen" - has leveled the playing field. Prices emanating from completed trades are now being relayed by clearing systems such as Globex or ICE with the banker in Chicago, farmer in Brazil or the speculator in Dubai. They all now receive data at close to equal speed. Before the advent of the computer and electronic trading, you had to be on the trading floor, in a broker's office or glued to your phone calling your broker to buy and sell.

Now, however, you can trade with software on your computer, on the internet from the comfort of your home or from an application on your cell phone while sunning on the beach. And yes, if you prefer, you can still call a broker on the phone and have him place your trade for you.

Once one understands how commodity trading can be a viable investment vehicle, an understanding of various commodity trading strategies is paramount to identifying opportunities when they present themselves, while noticing the level the of risk. The two primary approaches to Commodity Trading are either fundamental or technical analysis.

Since most commodities are agricultural such as grains, livestock and softs cotton, cocoa, orange juice, coffee and sugar with the Energies being an exception , there are cycles that they go through as they go through the growing year or life cycle and can be traded in a seasonal strategy.

These seasonal tendencies, along with supply and demand analysis, make up some of the Commodity Fundamentals traders use to identify potential opportunities while acknowledging that even seasonal tendencies can be unreliable and move counter seasonal. Then there are those traders, who while they may be aware of some of the commodity trading fundamentals, still rely on commodity charts and patterns that form. Commodity technical traders usually use indicators such as moving averages and overbought-oversold indicators for confirmation of signals that price charts are reflecting.

There are a plethora of indicators that commodity traders can choose from and some traders use them solely for buy and sell signals and are used extensively in Algorithmic trading. Whether the Trader is trading commodities technically or fundamentally, there are several basic approaches and Commodities Trading in Macon GA strategies.

One popular approach is day commodity trading, where a trader closes out all trades that have been made during the time the commodity trading markets are open, but before the close. Day Traders use short time frame charts and indicators looking for short, quick profits without risking much capital. Charts comprised of 1-min.

price intervals are commonly used. Another shorter term approach to commodity trading is swing trading , which can still be a Day Trade but with a slightly longer life span, using min. or min. charts and usually looks for the trend for the day and tries to, in the case of an uptrend for example, buy the dips and sell the rallies and might be in each trade for an hour or two, to a few days. One of the oldest approaches to commodity trading is the position or trend trade where the trader is in the market trying to catch a trend that can last days, weeks and even months.

One of the most overlooked commodity trading approaches , used not only in the Commodities Trading in Macon GA but in other assets, is called spread trading. This is where you buy one contract and short another simultaneously. With this strategy the trader is looking for the difference in price between the buy-side and the sell-side to widen or narrow in his favor.

There are inter-commodity trading spreads such as buying one contract month of a commodity versus selling a different month of the same commodity, for example: buying May Corn and shorting December hoping that the price of May Corn gains on the December Corn price.

The other type of spread is called an intra-commodity trading spread where the trader buys one commodity and sells a different but related commodity. For example buying the year Treasury Bond and shorting the year Treasury Note. Trading options on futures is another method of futures commodities trading. Options can be used to play the long or short side of the desired market. Put Options are used for downside intentions and Call Option are used for upside or long side intentions.

Buying options can limit your risk to the premium paid for the option and commissions. Selling options is more risky because the loss is not limited to the cost paid for the option. There are many complex strategies of trading options on futures including buying and selling options at different strike prices and more. There are several ways to invest in the Commodities Market. Whether you wish to make your own decisions and be what is called self-directed, work with a licensed Series 3 broker, find an automated system, where the trades are placed for you or have your account personally managed by a money manager there are some important steps to take.

The National Futures Association has a website where you can if there are any serious infractions that involve the Broker you are contemplating doing business with. Once you are comfortable with who you are talking with you need to decide how much "risk capital" to allocate to this investment because losing it should in no way impact your lifestyle. Remember, this is a highly leveraged, speculative investment regardless of who is trading the funds and deciding what level of service you choose to go with should be the next decision you make.

After e addressed these considerations, the brokerage office you will be interacting with, will supply you with the funding instructions which will go to the account of the Futures Clearing Merchant or "FCM" that your broker uses to execute your trades. The FCM will then deposit your funds at whichever bank they do business with. There the funds are kept segregated, in your name, and drawn upon as needed by the FCM as needed.

With your approved Futures account application completed, by you and approved, you with be issued an account number that will be referred to whenever a trade is placed. You will then be emailed a daily account statement every evening that shows existing open trades, if you carry trades overnight as well as any new activity or trades from the prior day that have been entered or closed out.

It is a very detailed report that also shows any fees charged, margin requirements, both excess margin or deficits, and liquidating value which shows you what your account is actually worth if you have no positions in the account or if you have positions in the market what the accounts market is if those positions where liquidated at their current value minus any exit fees.

Demo Trading , also known as simulated Commodities Trading in Macon GA , paper trading, playing with Monopoly money; whatever you'd like to call it, an online futures commodity trading platform demo can be your best friend or your your worst enemy for beginner to intermediate commodities trader. Get your fills by knowing the ins and outs of your commodity Trading Demo. Demo Trading. Also known as simulated Commodities Trading in Macon GA, paper trading, playing with Monopoly money; whatever you'd like to call it, a demo can be your best friend or your worst enemy.

Every Futures commodities broker dreads having this conversation with their clients, as it is necessary with every new trader; however, much to a broker's chagrin, every new trader will say that they already understand when in fact they rarely do. Let me assure you, if you're a new or even intermediate commodity trader, you probably don't.

You may understand one popular issue of the conversation but odds are if you have been paper trading for five years waiting to be "successful" or to "understand the futures commodities markets" in the simulated world before moving on, you have less of a chance of being successful in the live futures markets because you're setting yourself up for failure if you ever do, in fact, trade in the live markets.

You should seriously consider speaking with a licensed commodities and futures broker before diving in. First and foremost, it's a wonderful technological tool for testing out a platform to see if it will suit your Commodities Trading in Macon GA methodology.

It can also be used to try different trading strategies, but problems arise when one equates simulated commodities trading too much with live futures trading. No matter how many houses you can afford to build on Pennsylvania Avenue with your simulated money and no matter how many rail roads you've had to mortgage to pay the rent, the hypothetical results you've attained in your simulated trading do NOT, and never will, indicate future results in the live markets or any markets for that matter thanks for reading through the board game references, I'll keep it to a minimum from now on.

Between misplaced expectations, developing an inability to adapt and false expectations of profits that you've earned paper commodity trading, you have set yourself up for an even more uphill-battle than you were originally up against. To clarify before moving on any further in this post, I want to be very clear about a few things:. The first issue many traders already know about is the false sense of security with your fills.

The idea of a limit order is first in, first out. Take a moment. First in, first out. It's the golden rule of live trading, and it's a lesson you're never going to learn in simulated Commodities Trading in Macon GA.

Do not be "that trader" that is confused as to why it's taking so long to get filled once you start your live trading. It is not your platform, it is not your broker, it is not the data feed; it is the lack of fantasy fills you have been provided on a demo. And no, apologies to the automated commodity trading strategists, but you're included in the conversation as well: you could be testing your strategies on market replays of historical data on our platforms and getting unrealistic fills.

In the simulated world, your limit orders are likely to get filled as soon as the market touches your price. For example: if you're trying to go long a contract on a buy limit order and your entry price becomes the bid, a simulated seller may instantaneously take the other side of your contract; however in a live market, you're going to have to get in line behind all the rest of the orders placed before yours waiting to be filled.

In less liquid markets you may not notice as much of a difference as there may not be too many people in front of you; however, in more liquid markets such as the popular e-mini indices or the interest rates, you will notice quite a difference when the market keeps bumping against your price without filling your order. Only when the market passes THROUGH your price are you guaranteed a fill on a limit order in the live markets.

This makes your hypothetical demo results much more difficult to interpret and sometimes impossible to trust. By solely trading on a demo platform for months and months on end, you can easily get used to this alternate trading reality making it extremely difficult to adapt to a live environment. You will never be able to simulate the emotions associated with gaining and losing money in the markets, and therefore you won't know how to contain said emotions until you experience them first hand.

It's easy to accept your losses and move on when you're playing around with fake money, but you will start questioning every aspect of your commodity trading by the time you hit the real markets and lose money for the first time. It could take futures traders months or even years to finally understand that even though they might have made hundreds of thousands of dollars on a demo account, it can easily translate to losses in the real markets.

The difficult part of it all is traders rarely blame themselves; as mentioned before, they can target the platform, brokerage firm or data feed, when in fact they might all be working and doing their jobs just fine.

In any case, commodities traders can set themselves up for unrealistic expectations for the markets and never see their visions come to fruition. Beginning traders can leave the markets angry and frustrated when of course the markets provided plenty of opportunities on both sides of the market for risk and reward alike. Paper traders will consider themselves experts of the markets and in fact they may be able to recognize a head and shoulders pattern forming from a mile away, but when it comes to controlling losses or calling it a day after achieving respectable profits on their account, they just can't quit.

When it's all said and done, paper trading can be the ultimate crutch of live futures Commodities Trading in Macon GA. For traders going back and forth between the two, they can gain a respectable balance of adjusting their commodity trading strategy while still keeping in touch with the fill-reality of the live markets.

If you're going to base your commodities trading success on how you've done in the simulated markets, though, you need to take a step back from the screen and have a serious conversation with a broker here before you dive in.

While other brokers might get flustered and be unwilling to educate those who need it, our brokers are always happy to step in—that's the Cannon Trading difference.

Gold holds an almost universal appeal due to its rarity, versatility, and beauty. Trading commodity futures and options involves substantial risk of loss. In most of the cases, the benefit is reduced margin requirements. There are also a number of different approaches to trading, including day trading, swing trading and position trading. Many individual investors physically buy gold coins and bullion as a way to avoid the uncertainties of inflation, and the volatility of other asset types.

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