1. Your Questions About Commodities
Lizzie asks…
What is the difference between a purchased Commodity (in the
commodities market) and Futures.?
Is there a difference between buying wheat in the commodities market, for example, and
buying wheat futures?
Steve Winston answers:
The spot price is what you can buy or sell it for right now for immediate delivery, the posted
prices at the grain elevators The futures prices is what you can buy or sell it for at some point in
the future using a futures contract.
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2. Mary asks…
What are the top commodities that Iran exports to the Philippines?
And vice versa, what are the top commodities that Iran imports from the Philippines?
Steve Winston answers:
Iran Yelllow Cake Uranium
Phllipines Baluts.
Laura asks…
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3. How can you explain commodities , futures and the link to farming
to a child?
I've tried a lot of websites and books but none of them break it down fully for someone just
getting familiar with this. I basically understand the idea of hedging, but I get a bit lost when
people talk about spreads and basis and most of all, I don't understand the link between
physical commodities and all these bits of paper that are apparently traded on futures
exchanges.
Steve Winston answers:
If a corn farmer looked in the paper and seen corn trading at 6$ a bushel and said to himself if
only it was november and I had my corn harvested I could sell it and make a profit and be
happy, but every year when I sell my corn the price is so low I loose money. Futures give the
opportunity to the farmer to sell in Febuary and make a profit. He then would be hedged against
the spot price of corn. So when November comes and the spot is 3$ a bushel his 5000 bushel
harvest would be down by 15,000$ dam!! But then he would he would buy back his futures
contracts that he was allready paid for 15,000$ less meaning he made a profit of 15000(30,000
he originally received-15,000 to close out) The point here to understand as a true hedger he can
never loose on the decrease in the price of the commodity whats the catch, he can never gain
on an increase in the price. If the price of corn was 9$ a bushel in November he would be up
15,000$ on the spot price but to close out his futures hedge he would have to buy back his
contracts for 15,000 more than he originally received. So whats the moral of this story he darn
well better be happy with 6$ a bushel.
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4. Sharon asks…
how to start trading in commodities in indian market online?
i want to invest & earn from commodities trading.please provide me the systematic investment
& trading skills.
tricks for trading commodities
Steve Winston answers:
Hi
first you have to open a mcx account with any brokerage house after that you can start trading
in mcx through your broker for further information you can call me at my mobile number
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5. Joseph asks…
Where can I get advices on futures trading commodities?
I want to start as a commodity trader. I need futures and trading recommendations to have
stable steps. Where can I get advices on futures trading commodities?
Steve Winston answers:
Everything will get easy with Pit. Pit will take you high in trader floor with valuable advices on
futures trading commodities and daytrading recommendations. Get directions from Pit, you will
not be wrong!
Http://pitguru.com/
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