5 Things to Know Before You Trade Futures

Filed Under (Futures And Commodities) by admin on 30-11-2009

Prior to trading any futures market, you should do a reasonable amount of research to get information about how that market works. Knowing the characteristics of the market and the requirements of your broker can make you more successful and give you more peace of mind about the positions you are trading. What exactly does that mean? It means finding out several things including:

1. What are the normal trading hours for the market?
2. Does the market trade extended hours?
3. What are the minimum price movements (ticks etc.) for the market?
4. What is the minimum margin requirement to hold your position?
5. How long does the market close between normal and extended trading hours?

Unlike stocks, many futures contracts continue to trade after normal stock market trading hours. E-mini Dow and E-mini S&P contracts offer this. Depending on how you look at it, this can put you in a position to take advantage of continuous price movements, or put you in a position to be exposed to increased chances of experiencing losses. I personally feel that contracts with liquidity, tight spreads and extended trading hours are more beneficial because you don’t have to wait until the following morning to see where prices are.

You should also understand the minimum price movements of the futures contracts you trade. As of this writing, a minimum price movement for E-mini Dow contracts is approximately $5.00 every time there is a change in price, while E-mini S&P contracts are $12.50. Knowing this can also help you pick which contract fits your account size and comfort level.

Another thing you should know before you trade futures are your broker’s minimum margin requirements. You should also make sure you verify with your broker, to make sure you understand their margin requirements to trade, and to stay in a trade. Different futures and commodities brokers will probably have different margin requirements, and many brokers will have much smaller day trading margins if you decide, not to hold your positions overnight.

You should also make sure that you know how long the market closes for your contracts. Some contracts like the E-mini S&P trade almost 24 hours a day, with a small break of just a few minutes before the contract continues to trade throughout the night. Other contracts may stop trading for several hours, or may not resume trading until the following morning.

One of the keys to successful trading and peace of mind is to make sure that you understand the basics of the markets you trade, beyond just analyzing price and trends. Knowing these things before you trade futures will give you peace of mind and more confidence about the futures and commodities you trade.

I hope that you will be more successful by knowing these 5 things, before you trade futures.

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Is Gold a Good Investment?

Filed Under (Futures And Commodities) by admin on 30-11-2009

Gold has been used as a medium of exchange for more than six thousand years, this is one of many reasons why gold was and is considered one of the soundest investments to own. Gold just like any other investment out there can only be recommended if the investor’s goals coincide with what gold is likely to do in the future. If the investor’s goal is to take a high risk investment in order to see large and quick returns; physical gold may not be the best investment that coincides with their goals.

If an investor is looking for an investment for the long term that has low risk; physical gold would be the ideal investment in that case. One other aspect about gold is unlike other investments gold can not become worthless because of the actions of a few, unlike a stock or a bond. If the organization that issues the stock or bond is engage in dubious accounting practices, the value of the stock or bond can be affected drastically.

Gold coins and bars have been shown to hold its value or sometimes even increase its value when the manufacturer of the coin or bar ceases to exist. The reason for this is if a gold coin stops being manufactured it can essentially mean that coin becoming a collector’s item. Also if the coin was not manufactured extensively it can mean it becoming rare as well. To answer the question is gold a good investment, knowing the investor’s goals is one of the most important factors in answering the question.

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When Buying Silver, Coins Simply Make Sense

Filed Under (Futures And Commodities) by admin on 30-11-2009

Investors have a variety of instruments to gain exposure to silver. Often, deciding how to buy silver (in the form of coins, numismatics, futures, ETFs, or stocks) can be one of the most important decisions an investor makes.

Physicals First and Foremost

Physical metals, which you can hold in your hand, are the best way to invest in today’s low silver prices. The adage “if you can’t hold it, you don’t own it” couldn’t be truer in today’s world of commodities investing.

After the Great Depression, the federal government made gold and silver ownership illegal. Thus, silver and gold held in vaults were confiscated at prices well below market value, while physical gold and silver coins remained in the custody of their owners. While it might be a stretch to think the same may occur today, the government’s actions in the 1920s do shine importance on the ability to actually hold and own your precious metal investments.

Silver Bars and Coins: Making the Choice

Of the different types of physical silver, investors have to make a choice between silver coins or bars. Coins usually contain as much as one ounce of silver and can sometimes be mixed with other metals to form a stronger coin that can last many transactions.

Bars, on the other hand, are almost always entirely pure, and vary in sizes, shapes and the brand stamped onto the bar.

From the perspective of liquidity and acceptability, coins are both easier to sell and authenticate, as the weight, measures, and silver content of each coin is well regulated by the mint and published in a number of coin books. Bars offer less liquidity, as they can range in weight from 10 ounces to 100 or more.

At today’s prices, a 100 ounce bar of silver costs as much as $16,500 – which only a few banks, coin dealers or investors may be willing to buy. In addition, bars can vary in their stamp from the producer, which authenticates its purity and weight. Some investors will only buy silver stamped by certain producers, while almost all of them will buy official US mint coins.

Pricing Premiums

Physical metals do come with a higher premium than other “paper” forms of silver due to storage and shipping costs. However, with physical metals, the premiums do not disappear after the silver is purchased. In fact, the premium may actually grow as demand for investment-grade silver grows.

One of the many reasons physical metals carry a premium is that there is much greater demand for small units of silver. In addition, physicals are more readily demanded by investors than “paper” silver.

Making the Right Investment

The lowest premiums and the highest liquidity are often found in old dollar coins and in junk silver, which is 90% silver by weight. The small units allow for small transactions, opening the pool of investors to whom you can sell. Their size also increases the premium price you’ll be able to receive for your silver in the future. In addition, in many areas, silver is being accepted at its spot value, and coins like the pre-1965 quarter has a value of roughly $3, making it easy to exchange.

In the beginning, a lot of folks feel intimidated about buying physical silver. However, in the end, it may be the safest way to play.

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Trading Oil For Major Profit

Filed Under (Futures And Commodities) by admin on 30-11-2009

If you are an investor or are searching for something to invest your capital in that will truly bestow you a advantageous ROI as well as let you to sleep happily without stressing out regarding your money being lost in an the blink of an eye you should honestly consdier trading oil. Did you know that around 95% of people who get involved with financial trading lose a lot of money?

There are so many investing websites that are more interested in their bottom line, than your’s. Forex is very popular these days and it is one of those businesses where the vendors are building fortunes despite the fact that the people trading are losing more and more capital by the day. I want my trading account balance to escalate, not just the system vendor’s bank account.

That is why future oil trading is one of the most excellent investment opportunities around for any major investor or small-time trader. You can trade oil from any place in the world with a free price feed starting with merely $300 capital or more.

The greatest thing about the oil trading business, is that there are simple to follow, precise rules with no repainting and if you follow them you can double your capital (or even more) every single month when the trading conditions are respectable. There is only one thing to trade, so it is a lot less complicated than other trading instruments.

With oil trading, you can profit from declining prices, just as easily as you can from rising prices. There are stop loss functions (like with Forex) that let you to cap your losses and by no means lose more capital than you are ready to endanger or can spare.

There are so many advantages to trading oil that it would be tough to discuss them all now. Take it from a seasoned investor… trading oil is the way to go.

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Sparkle of Online Investing Enhanced by the Bullish Gold Market

Filed Under (Futures And Commodities) by admin on 30-11-2009

There seem to be an awful lot of commentators with an opinion on just where the price of gold is heading. Recent increases have focused attention once again on this precious metal. Of course there are both bulls and bears putting forward what they think, only time will tell what the outcome will be.

Personally my Bullion Vault account is now looking very healthy and as a way of diversifying my investments this is currently a success. The question is will this upward climb continue or will the bottom drop out of this particular market?

Reading various reports I’d say the balance is in favour of a rise in the value especially over the long term. You can take your pick as to where the price will end up but I’ve seen figures ranging from $2,000 to $6,000 an ounce over the next 12 to 24 months. Of course there are also opposing views that predict a price drop but even these see this as a short term dip rather than a major market correction.

I think it is clear that holding gold as part of your investment portfolio is a wise move and Bullion Vault is for me the most convenient and economical way to do it. You are able to fund your Bullion Vault account from your bank account so there is a quick and easy path for funding.

You can choose to hold your gold in London, Zurich or New York (or a combination) and you receive regular statements on your account. The security is first class and you are immediately notified if your account is accessed so that you know just what is going on.

Whether you decide to invest a portion of your funds in gold is a personal choice but overall I think that it is a wise move given the positive reports circulating at the moment. As a proportion of your overall portfolio most commentators recommend something in the region of 5%. This may be a little conservative and you may want to up this slightly if a short term price drop does occur.

Ezinearticles

About Gold Bullion

Filed Under (Futures And Commodities) by admin on 30-11-2009

Do you want to purchase gold bullion? In this article, you will find out the information you need to buy gold. Discover the information you need to get the gold bullion you need.

There are some things to consider before buying. The first thing you need to figure out, is whether you are buying as an investment or just buying.

This will make a big impact on the decisions you make. For example, if you are investing, then the biggest bullion will be the best.

Looking for some gold, but don’t want to invest much. Rather you look at the gold? In this case coins are a great way, because they are made out of gold, yet they are also of a good design.

There is a point to remember with any of these investments, and that is that both methods are investments, however, not all of them bring the biggest return on investment.

For example, coins look good, however, a lot of the money has gone into delivery, packaging, and making the coin. The result is that it can take a long time to recoup your investment.

Investing in bullion is a great way to own more gold, rather than putting money onto delivery, etc. However, the result with all these methods is that you have a good investment that will rise over time!

They come in several different sizes, and shapes. There are a number of refiners who make these fantastic items. Doing some research, you can find 1 gram, and right up to kilogram sizes!

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