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Thursday, February 18, 2010

Commodities Trading and Futures Speculation (Series): Contracts and More Contracts !! (VIDEO)

"A verbal contract isn't worth the paper it's printed on" - Samuel Goldwyn

This vlog entry is a continuation in a series of videos, the "Commodities Trading and Futures Speculation", and is continued from the previous entries.

Introduction: I discussed some of the myths regarding commodities speculation, and introduce the entire series.

The Reason for the Markets Existence: We discussed that the commodity futures markets exist, to allow companies, farmers, and others involved in production within the economy to hedge themselves against catastrophic losses. This in turn, keeps unemployment lower, and reduces volatility in the economy.

Why Traders Trade Commodities: Ok, if the commercial interests use the commodity markets to protect their business profits, then why are traders in those future markets? We discussed liquidity, and that the commercial interests need that trader liquidity, in order to hedge more efficiently. Without traders, the commercial interests have a very difficult time operating in the markets.

Collective Crowd Wisdom: We next discussed the free market benefits that traders bring to table while they are trading future delivery contracts.

So let's begin to get into some of the 'nuts and bolts' of the commodities, and at the same time, dispel a few myths and rumors that have persisted as of late. We'll begin by discussing Commodity Contracts ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click here to view the entry ...)



We will continue this series by discussing the expiration aspect of contract specifications with commodity contracts.

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Note: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have over 13 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.


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