Posts tagged futures

CURRENCY FUTURES – FOREX AND TRADING OPTIONS

Been a funny old day at the Trading With Common Sense offices in that the markets have to all intent purposes been treading water but as far as our accounts are concerned we have had a “blinding time” i.e. on one account we started the day at £57,259 and just recently closed the last transaction of the day to bring the fund up to £102,118.74 a staggering profit for the day of £44859.04 and an ROI for the fund for the day of 78.34% which equates to an annual rate of……well “loads of wonga” as a colleague of mine once eloquently put it.

The strange thing was as you see the as far as most FTSE trades were concerned the index actually opened and closed within 15.74 points of each point but the story of the day was the tremendous range trading in between. Perhaps we were lucky and perhaps we just managed to “get into the zone” for the best part of the day but to be honest that would be making more of it than it actually was. A lot of the trades were so mind stunningly simple to make that it would “over egg” the report to make anything more of it than usual.

The day kicked off with better than expected results from major UK Bank Barclays which though as I said better than expected still didn’t manage to fire up the markets to the degree that they perhaps would have done in the halcyon days before the present muddle that we find ourselves in. Still at least they didn’t throw the market into a downward spiral which has quite often happened in the past. With net profits of £6.08Bn they were 14% down on the previous year but up on analysts expectations so as a result rose by some 10% on the day.

I think the key story lay “over the pond” as we Brits like to affectionately refer to the Atlantic in that what was fast emerging from various sources was a slightly different take on the so called “financial bailout” or stimulus plan as the “Obama” White House would have us view it. The plan being discussed now was one with which a major component was to include a large degree of private funding from a various number of sources that would be underwritten by various Federal Agencies.

Basically the markets are running scared now and looking for a gift and one with which there are very little in the way of surprises. This as you could imagine does not exactly fit the bill and the end result was market which started by plunging 60 points straight after the opening bell and then spent the rest of the day see-sawing between 8300 points and the lower 8200’s and ultimately finished at around the 8237 mark.

One of these days Politicians will learn that the best way to stabilise or control the markets is to actually limit the number of surprises it experiences and therefore altering a large part of a hitherto announced financial package at the last moment falls into the category of what is known as a surprise.

Bankers might be incompetent but banks controlled by politicians, now that’s a concept guaranteed to strike fear into the hearts of most free thinking folk. Heaven save us from Politicians.

Day Trading in either Futures or Forex is much simpler than you think if you knew where to look and for those interested then sign up to the list on our “2 sure fire strategies” list for firstly to get our two free strategy gifts but also to be put on thewaiting list for our Trading With Common Sense E-Book.

Author: Stephen Morgan
Article Source: EzineArticles.com
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HOW FUTURES EXCHANGES WORK

The majority of future contracts are traded on one of the 11 futures exchanges that are located in the US, London, Winnipeg, and others that are located throughout the world. Since these contracts can only be traded on the market that issued them there is no over the counter market. This means that if an investor buys a contract on one exchange, that all transactions concerning that exchange need to be handled during that exchanges hours, and at that exchanges prices.

Every order that is sent to the exchange if filled by a open outcry. What this means is that every order to buy or sell must be called out publicly, in a process that is similar to a auction, but it is called a price discovery. This simply means that those who scream the loudest make the most deals.

Most traders will charge their clients a hefty commission to execute their orders. Unlike the commissions that are charged on stock transactions, one for buying and another for selling, futures brokers only have one commission that they charge, to open and close a position. However, commissions are higher though, more often than not they are 18% or more of the cost of the transaction, opposed to the 2% or less that is charged for stock transactions.

For the first time in history the futures exchanges are facing competition from brokerage firms that have created derivatives for their clients. The idea behind this is that futures can be custom designed and timed to fit the specific needs of their clients, so that they aren’t at the mercy of the pit traders.

The Commodities Futures Trading Commission is responsible for monitoring the activities of the various exchanges. They do what the Securities Exchange Commission dose for stock trading. However there are some legitimate trading rules that seem to permit conflicts of interest, that are not allowed in stock trading. For example it is legal for a trader to be trading for himself and his clients at the same time, this is a practise that is known as dual trading and it has been singled out as being less than fair. With this practise a clients trades can be executed at a less advantageous price when the traders self interests take precedence.

Although on the plus side, these exchanges have standardized rules, accurate price records, and trading limits that prevent excessive price fluctuations.

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Author: Erik Schouman
Article Source: EzineArticles.com
Digital TV, HDTV, Satellite TV

MY EXPERIENCES TRADING EUROS AND CURRENCY COMMODITY FUTURES CONTRACTS AND OPTIONS

The Euro has taken over the currency trading arena! Here’s some valuable hints and kinks taken from actual trading experiences.

The Euro is the new European currency. It’s easy to confuse the Euro with the “Eurodollar,” which measures interest rates for funds held in European banks. The Euro has become the primary source of foreign exchange globally. It’s competing with the US Dollar as the primary store of value. It’s the most liquid and active currency futures contract traded and is well suited for day trading as well as longer-term positions.

An account margin of $3000 will control a $150,000 Euro futures contract. (at today’s market) Each full-point move in the Euro equates to a $1250 profit or loss. There is also a mini-contract that is one-half the full-size Euro.

More and more countries are becoming members of the Euro confederation. The Euro will probably become even more popular and liquid in the future. Euro futures trade 24 hours electronically on the Globex, stopping Friday evening and starting again on Sunday night. Euro options are pit traded and trade within specific hours.

The full-size Euro futures contract is perfect for seasoned traders. Novices have the choice of trading mini-contracts, which are also available on many of the other currencies. Since the trading hours are extensive, traders must be vigilant to a multiplicity of reports. Many of these will occur in the dead of night when most traders are sleeping in the U.S. This is one major reason why you need to use protective techniques for futures or short option positions.

Euro futures trade like the Swiss Franc. Their price charts look very much alike. The British Pound will look a little different but has a similar chart as well. The Japanese Yen will look much different but the turning points are usually the same. Currency traders are constantly looking for disparities and advantages that can be traded due to interest rate and political changes. The US Dollar Index also trades but is relatively illiquid compared to the Euro or Yen.

The other currencies that lend themselves to trading aggressively would be the Canadian Dollar and the Australian Dollar. The Canadian Dollar trades well and sometimes trades like the U.S Dollar, though other times it trades counter. The Australian Dollar is sometimes in synchronization with other Asian currencies. There are times when it trades more in rhythm with the Euro. In other words, these relationships are always changing and we need to study what is happening right now.

There are methods to trade other currencies against each other. For example, there is a Euro-Yen contract. The Euro-Yen contract maintains the relationship between the Euro-Yen without involving the US Dollar. You will still have to convert back to dollars after the trade is finished. Some of these currency contract combinations are quite liquid while others are not. Check the open interest and volume to see if you can enter and exit without getting a haircut.

Technically, the currencies exhibit patterns and wave structures that can be traded effectively. Patience is the key to let the market come to you. Day-traders are attracted to the currency markets. The short term swings, quick fills and great liquidity make this ideal for the trader who can handle the heat of the moment. If you are a short-term trader, make sure you trade that way. If you are long-term trader and can handle the risk, stay that way. I have seen many traders lose in the long run when they jump back and forth between methods in the middle of trades.

Here’s how I look for opportunities in the currency markets: First I generate a TimeLine forecast that shows a strong move up or down in a particular currency. The TimeLine is based on time cycles and other preprogrammed patterns. I then determine if the move is expected to be choppy, trending, and for how long. This helps us focus on possible directional futures/option positions or writing options in a range, or even writing options with the trend.

Next I use automated option software to search for the best of 1600 strategies based on the expected market move. I compare these option to option combinations against futures to options combinations. At some point I will find a compromise between risk, profit and simplicity in one or two strategies. In hindsight there’s always a best strategy we could have used. Keep this is mind when narrowing down the choices. When finished, we want to have one or two potential trades to work with. We call the selected few, “high probability, low risk trades.”

Remember there is more to planning a trade than just coming up with a forecast. The market may move as predicted but we can still lose by choosing the wrong trading vehicles. Pick the right vehicles and strategies that will allow us to stay in the market without excessive fear, but still carrying calculated risk.

We NEED to take on calculated risk or the market will not pay us for our services. In addition, the vehicle has to move far enough to make a profit without letting the expense of protection eat us up. Excessive protection (risk avoidance) can come in the form of option premiums, too close-in stop loss orders – and overdone, complex spread strategies. Matching a forecast to a strategy is an important skill to succeed in commodity trading.

Good Trading!

There is substantial risk of loss trading futures and options and may not be suitable for all types of investors. Only risk capital should be used.

Thomas Cathey – 27-year trading veteran heads the managed futures division of Thomas Capital Management, LLC. View his market forecast TimeLine Trading charts and get his complete 44+ lesson, “Thomas Commodity Trading Course – all free.” [http://www.thomascapitalmanagement.com/commodity/welcome.htm] Main site: [http://www.ThomasCapitalManagement.com]

Author: Thomas Cathey
Article Source: EzineArticles.com
Canada duty rates

FUTURES EXCHANGES – KNOWING WHERE TO DO BUSINESS

Good for you! You’ve been reading, you’ve put together a trading rules to lay the foundation for your futures trading plan and you’ve even been paper trading to prove your trading plan. Now you are ready to learn more about where you will be doing your business; it’s time to talk about the futures exchanges.

General Futures Exchange Information

As you know at this point, you will not actually do business with the futures exchanges listed below. You will work with your broker who will take your futures orders to the exchange floor for you. Since you have been paper trading, you probably have already established an account for commodities trading so we won’t go over that again. While there are futures exchanges throughout the world, we will focus on the ones in the US. The markets we will outline are in Minneapolis, Kansas City, New York and Chicago.

History of Futures Exchanges in the US

The modern futures trading began in Chicago, IL in the early 1800s. Chicago, with its location at the base of the Great Lakes, is close to the farm of the U.S. Midwest which made it a natural center for transportation, distribution and trading of agricultural produce. Gluts and shortages of these products caused extreme changes in price. An exchange was needed that would bring together a market to find potential buyers and sellers of a commodity instead of making people bear the burden of finding a buyer or seller. In 1848, the Chicago Board of Trade (CBOT), the world’s first futures market, or futures exchange, was formed. Trading was originally in futures and the first contract was written on March 13, 1851.

Futures Exchanges

Different futures exchanges trade different commodities. In addition, each future exchange accepts different futures orders. Since not every exchange allows every order it is necessary to talk with you broker about which orders are permitted in the markets you trade. The following is a list of the major commodity exchanges, their commodities, and the orders that they accept:

Chicago Board of Trade

Location: Chicago, IL

Commodities

o Corn

o Oats

o Soybeans

o Soybean Oil

o Soybean Meal

o T-Bonds

o T-Notes

o Muni Bonds

o 5 Year Notes

o 2 Year Notes

o DJIA Index

Acceptable orders: Market, Market on Close, Limit, Stop, and Fill or Kill Orders

Chicago Mercantile Exchange

Location: Chicago, IL

Commodities

o Live Cattle

o Lean Hogs

o Lumber

o Feeder Cattle

o Pork Bellies

Acceptable orders: All futures orders are acceptable.

Index and Option Market

Commodities

o S&P 500

o Mid-cap 400

o NASDAQ 100

Acceptable orders: All futures orders are acceptable.

International Monetary Exchange

Location: Chicago, IL

Commodities

o T-Bills

o Euro Dollars

o Canadian Dollar

o Euro Currency

o Australian Dollar

o Mexican Peso

o Euro Yen

o Japanese Yen

o British Pound

o Swiss Franc

Acceptable orders: All futures orders are acceptable.

New York Comex

Location: New York, NY

Commodities

o Copper

Acceptable orders: For Copper only, acceptable are Market, Market on Close, Limit, Stop, and Fill or Kill.

Commodities

o Gold

o Silver

Acceptable orders: For Gold and Silver, acceptable are Market, Market on Close, Limit, Stop, and Fill or Kill. Stop Limits are acceptable only on a not-held basis.

New York Cotton Exchange

Location: New York, NY

Commodities

o Cotton

o Orange Juice

o Dollar Index

Acceptable orders: Market, Market on Close, Limit, Stop, and Fill or Kill.

New York Coffee, Sugar & Cocoa Exchange

Location: New York, NY

Commodities

o Coffee

o Sugar

o Cocoa

Acceptable orders: All futures orders are acceptable.

New York Mercantile Exchange

Location: New York, NY

Commodities

o Unleaded Gasoline

o Platinum

o Palladium

o Heating Oil

o Crude Oil Natural Gas

Acceptable orders: All futures orders are acceptable.

New York Futures Exchange

Location: New York, NY

Commodities

o New York Stock Exchange Index

o CRB Index

Acceptable orders: All futures orders are acceptable.

Kansas City Board of Trade

Location: Kansas City, MO

Commodities

o Kansas City Value Line

o Kansas City Mini Value Line

Acceptable orders: All futures orders are acceptable.

o Kansas City Wheat

Acceptable orders: Market, Market on Close, Limit, Stop and Fill or Kill.

Minneapolis Board of Trade

Location: Minneapolis, MN

Commodities

o Minneapolis Wheat

o Minneapolis White Wheat

Acceptable orders: All futures orders are acceptable.

http://www.candlestickforum.com/PPF/Parameters/1_21_/candlestick.asp A site dedicated to stock market investing using Japanese Candlesticks

Author: Stephen Bigalow
Article Source: EzineArticles.com
Digital Camera News

STOCK INDEX FUTURES

There are around 70 stock index futures contracts that get traded in the different stock exchanges around the world. Everyday something amazing happens to the stock index at almost the same time and if you know the secret you can become rich by just trading stock index futures for only 15 minutes daily when the market opens.

Stock index futures are the most fascinating financial innovation in the last five decades. Today many people make a living by day trading stock index futures. The most popular among the stock index futures is the S&P E-Mini Futures which is traded electronically.

Futures trading has been around for hundreds of years and it originally started from the farmers need to guarantee a fixed price for their future crops. Hence the name futures. Soon futures markets developed where buyers and sellers in these agricultural commodities could meet and make a contract that was based on the delivery of the crop on a future date known as the settlement date at a specified price.

However, Stock Index Futures have only been around for the last three decades. The famous S& Futures contract was introduced in 1981. Within a few years more dollars were being traded by volume in these futures contracts as compared to the total volume of stock investment in the New York Stock Exchange.

Now many investor make a fortune just by trading stocks and never try to trade these futures contracts. You really don’t need to trade these contracts because trading these futures contracts is totally different as compared to investing in stocks. However, if you want to comprehend the short run stock market movements than you will need to learn how these contracts are traded.

The stock market crash of October 1987 was precipitated by these futures contract due to something known as portfolio insurance. In portfolio insurance, you try to hedge against stock price fall by buying futures contracts. Today we can say that we are living in an era of one market where stocks and futures contracts are interlinked. As said before many people now make a successful living by day trading the S&P futures.

Now S&P futures value is determined by multiplying the S&P 500 Index points with 250. Suppose that the S&P Index is at 1300 points. This means that the value of the S&P futures contract will be $325,000. If the S&P Index moves to 1350 points, you make 50 points or $12,500 and in case the value of S&P Index declines to 1250 points, you lose 50 points or $12,500. So be careful when you trade the stock index futures.

Mr. Ahmad Hassam has done Masters from Harvard University. Know the Stock Index Futures Trading Secret That Can Make You Rich. Meet High Velocity Market Master and learn how to swing trade or day trade stocks, forex, futures, commodities, bonds, etfs.

Author: Ahmad A Hassam
Article Source: EzineArticles.com
Canada duty tariff

CONTRACTS FOR DIFFERENCE – FUTURES & FOREIGN EXCHANGE – LEVERAGED INSTRUMENTS EXPLAINED

What is a CFD A CFD is a leveraged trading instrument that allows you to trade a large numbers of shares for a smaller outlay than buying the actual stock or contract. In doing so your gains OR losses can be magnified compared to holding ‘traditional’ positions. You can trade LONG [UP] or short [DOWN- selling something and buying it back for less in the future].

Lets look at an example of trading stock ZYX….We will buy 1000 shares of ZYX at a value of $10

To purchase the real thing will cost us $10000, plus commission at around .4%.

To purchase 1000 CFDs of the same stock will only cost us $500 in ‘margin’- which we get back at the end of the trade IF we are right, Plus commission at around 1%.

This means that our R.O.I. [return on investment] is amplified much more when trading a CFD- and a WARNING- our losses can also be greater if we do not engage in sensible risk management.

Let’s assume we hold the position for 10 days and that the best brokerage rate we get is around .04% for traditional online broking and .01% with most CFD providers.

To ‘trade’ 1000 CFD’s will cost us a deposit of $500- deposits will vary anywhere from 3-20% depending on the stock and the provider, as a general rule count on 5% for the top 100 stocks.

When we ‘buy’ a CFD the provider is essentially lending us money to purchase our position. For the privilege they charge us the standard bank rate [RBA in Australia] which at time of writing is 5.75% + a ‘haircut’ of between 2 and 4%. This is a financing charge made by the provider let’s assume in our example the provider is adding 3.25% to take the interest rate to 9%. this equates to a charge of around $2.46 per day on a position size of 1000 shares.

Note when we sell short a stock the provider will PAY us interest. Though not at the same rate as when we buy usually the ‘haircut is in the 1 to 2% range so you would receive 5.75% -2%, or 3.75% on your short trade.

Dividends and adjustments:

CFD’s receive the full dividends that the normal stock does as well as any share splits or special payments. If in a short position you must pay the provider.

If we are taking a long position [planning that our share will rise] then CFD’s are a great short term option. If we bought a $10000 position and held it for a year we would need to pay $900 of interest. Similarly a Margin loan from a bank or other lending institution would charge you around 7 to 12% for the same privilege, but only lend you a maximum of 70% of the value of some shares.

FUTURES A Futures contract is an agreement to buy or sell something at a set price on a FUTURE date. I might agree to pay farmer Fred $25 for a bushel of wheat in August and it is now January… between now and January a hailstorm wipes most of the grain crop… A bushel of wheat is now worth $50, but Farmer Fred now has to sell it to me for the agreed ‘FUTURE’ we agreed on in August of $25. Similarly if there had been an over supply of wheat and it was selling for $13 a bushel to have harvested and delivered. I would still have to pay Farmer Fred $25.

A Futures contract is an AGREEMENT for payment at a set price on a future date.

Some futures contracts are DELIVERABLE. This means you do not want to be holding a contract for oil beyond the expiry date for example…. in the first place you need to cough up the cash for a barrel of oil— value $50000+, then they will come and pump it into your lounge room, unless you have a nearby oil storage facility!

Most contracts are NOT exercised, but just be aware of the time your contract terminates. Most brokers will be on the phone to you the week before- asking if you want to ‘roll’ your contract- that means getting out of the contract that is set to expire and taking up the next contract… In some cases this is monthly. Oil trades this way – expiring around the 20th of the month.

Others are bi-monthly or quarterly. The Australian Share Price Index contract or S.P.I is quarterly, March, June, September and December with expiry around the 15th of the month… you will need to KNOW these dates. Things can get volatile as contracts are ‘rolled over’ from one month to the next contract.

In Australia futures contracts are traded through the Sydney Futures Exchange- which recently merged with the Australian Stock Exchange to become the Australian Securities Exchange.

A number of Futures exchanges operate In the United States; from the East Coast to the West coast. Some of the ones you will be familiar with would be;

NYMX [New York Mercantile Exchange] this is the place where the Crude oil price you see on the news comes from- NYMX light sweet crude is the benchmark. It is traded in an open ‘pit’ session – yep, all those guys wearing funny jackets and doing funny hand signals…… trading takes place between 1000 & 1430 New York time and it then trades electronically for most of the rest of the day. We can also find Comex Gold and silver at the NYMX.

CME Chicago Mercantile exchange- home of the E-mini on the S&P 500. You can also trade Pork bellies here!

CBOT [Chicago Board of Trade] Here you can trade anything from Soybeans to Wheat and Dow futures to 10 Year Bonds

To trade coffee or sugar or frozen orange juice concentrate you need to go to NYBOT-The New York Board of Trade http://www.nybot.com

Euronext is the home of London Sugar, currencies and European interest futures contracts.

To trade a futures contract you will need to open an account with a broker- this will mean a lot of form filling and declaration. After this you will deposit funds to your account. You need to make sure you have enough money to trade the ‘instrument’ you are interested in.

For example to trade corn your may need a deposit of $1000 per contract. But to trade one contract of oil requires a deposit of U.S. $5500, and the range in a trading day might be up to $3000 at $50 a point….. tread carefully.

The Contract on the share price index in Australia is the S.P.I. and currently requires a deposit of AUD $6200- and each point of movement is equivalent to AUD $25.

The S&P 500 has a big contract valued at $250 a point and a ‘mini’ otherwise known as an E-mini contract. This is one of the most liquid futures contracts in the world and is traded ONLY online.

The deposit is U.S. $$3,563 and each 100 point move = $50 so a move from 1498 to 1500 = 200 points or $100. Often the S&P can move five to ten points in a night. Sometimes an astonishing 20! That’s on just one contract.

Currencies Some CFD providers allow you to trade currencies, but when the trading is thick and fast their platforms cannot keep up to dedicated forex providers…. In my experience.

Once again it’s the leverage equation. Most Forex providers give leverage at 100:1 some at 200 to 1 and a few at 400 to 1

This means that with $1000- you can CONTROL $100000 at 100:1

$200000 at 200:1

or $400000 worth of a currency ‘pair’ at 400:1.

Scary if it goes it wrong way!

All FOREX currencies are traded as a pair- I will stick to what are known as the 4 MAJORS these are

GBP/USD- the British pound Versus the U.S. Dollar

EUR/USD- the Euro versus the U.S. Dollar- this is the most highly traded currency pair accounting for 70% of all volume and can have a ’spread’ [buy sell difference] of only 2 pips or points

USD/CHF The U.S. Dollar versus the Swiss Franc

USD/JPY The U.S. Dollar versus the Japanese Yen

In FOREX we Buy one currency and sell another against it… lets look at GBP/USD for instance

The Standard contract size is 100K or $100,000 of the currency You are trading

If I go ‘LONG’ 1 STANDARD contract of the GBP/USD it means I am buying $100,000 worth of US Dollars and simultaneously selling $100,000 worth of British pounds. We pay a small spread- but NO commission.

If the GBP rose in value against the US dollar then to terminate our trade we would have more POUNDS- the one we bought and less DOLLARS the one we sold- so we have made a profit. That’s the basics.

The FOREX market turns over almost 2 Trillion dollars a day, this is five times the money turned over in aLL the stock markets and futures exchanges in the WORLD!. Now that’s liquidity- you will always be able to buy or sell the four majors.

Trading begins at 6am Monday in New Zealand and goes through to 0700 GMT this is known as the “Asian session”, London- which is the ‘center’ of the financial universe then comes on board until around the United states session begins around 7.30 Am New York time…….. Some interesting trading takes place at this change-over time. So the week progresses until 5pm Friday New York time when the action ceases for the weekend and resumes at 6 am New Zealand time…….

One thing to be Very aware of is the wild ranges that can occur in FOREX; these are driven by ‘news’ events- GDP figures, employment figures, Interest rate rises or announcements can all provide phenomenal spikes on 15 minute and hourly charts, which are all very trade-able and profitable…. If you have the right strategy.

There are many websites that will give you a list of events happening on the day. It helps to be aware of these things .

GFT forex have an excellent news ‘calendar’ at http://www.gftforex.com/resources/calendar/calendar.asp In summary leveraged instruments can magnify both your profits AND your losses. Risk management is the key to longevity in any markets trading leveraged instruments.

Paul J Penton is a Private Trader, Wealth Educator and author of ‘RSI-X : Trading with RSI crossovers’ . Free Wealth creation Resources are available from his website http://mymillionairebuddy.com

Author: Paul Penton
Article Source: EzineArticles.com
Pressure cooker

CURRENCY FUTURES TRADING – YOUR ULTIMATE GUIDE

Currency futures are utilized by large financial institutions and forex traders for hedging and speculating functions. Note that the prices exhibited on the currency futures progress or move with the cash prices or the spot market. Currency futures trading signify a vital and effective method for huge financial companies and establishments with worldwide business concerns to efficiently handle and supervise any risks, fluctuations or variations, brought about by several local currencies in which they carry out business.

So what are the currency futures?

Currency futures stand for a commitment to accomplish and complete in cash or currency the value of contract elected in a specific currency at an established price. The futures market trade on several exchanges all over the world making it probable to instigate or close transactions at any time. The largest and most popular currency center in the United States is the CME Group.

When dealing with the contracts for currency futures trading, it’s critical to remember that every currency contract exhibits its own specifications. These incorporate when and where a specific currency may be traded, the value or amount of an incremental price change also known as the price point, the value of every price point in US dollars, the contract expiration date, and the rules and regulations stipulating the initial margin that each investor or trader must accommodate per contract, and the maintenance margin or the additional fees the investor must provide once an unfavorable price movement takes place.

Currency pairs and contract pairs are other terms used for currency contracts. If you purchase a contract for Euro, you are actually trading its worth and value relative to another currency. The good thing is that you can buy or sell your contract pair at any time before the expiration date arrives, though you are not allowed to terminate a contract since it is only possible at the expiration date.

Both hedging and speculation make use of currency futures. Hedging is the utilization of futures contract to inhibit currency fluctuations’ effects. This is most of the time used by producers that ship manufactured goods to different countries around the globe, since they are required to compensate money using the country’s currency. It is also used by banks connected to trading worldwide and importers and exporters shipping internationally.

Speculation is performed by traders that depend in predicting movements and changes of the trends in the market to make money. Steady and increasing indebtedness entail significant structural discrepancies in a country’s long-term goals and objectives. Therefore, long-term trends of currency are important function of the stability of trade in a country. On the other hand, short-term trading normally incorporates small interest rates fluctuations while high-interest rates commonly boost a country’s currency value.

Keep in mind that the currency futures trading are exceedingly leveraged. This means that what appears like an insignificant price movement can lead to huge swings in the value of your portfolio. The leverage’s frequent ratio is, seventy five is to one or even more.

Author: Ricky Deez
Article Source: EzineArticles.com
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GAS OIL SURGES AMID ICY WEATHER – EUROPEAN STOCKS, US FUTURES FLUCTUATE

We have entered a new decade with the hope that the year 2010 will bring a solid grounding to the fragile economic recovery allover the world and will give all of us reasons to smile and celebrate. Icy weather stood there to give us a warm welcome in this New Year. In the first week of January, world markets extended the New Year rally as better than expected key data boosted the confidence of investors. U.S. and China manufacturing sector surged, supporting a strong economic rebound. Experts believe that manufacturing in U.S. will fuel the growth and would create some job openings. Manufacturing this time stood touched the highest level since 2006.

However, the data of construction activity and pending home sales once again pained the gloomy picture. On 5th January when this report was released by the National Association of Realtors, the treasuries rose. The report revealed that worse than estimated drop in the pending home sales rose to 16 percent as compared to 2 percent as expected by economists and other experts. Snowstorms and icy weather brought good news for oil price. Below average temperature boosted the demand for oil and it approached $ 82 a barrel which is highest since 14 weeks, extending last year’s 78 percent advance. “Colder weather than average in the U.S., even hitting the north of Florida, has been pretty good news for oil,” said Hannes Loacker, an analyst with Raiffeisen Zentralbank Oesterreich AG in Vienna. He added further, “If the cold remains, the inventory gain we normally see in mid-January may be delayed.”

But it seems freezing weather did not affected the orange juice lovers. Orange juice jumped by the exchange limit in New York as Orange-juice futures for March delivery rose 10 cents to $1.4355 a pound which is the most allowed by ICE futures U.S. Orange juice rose 7.5 percent on concern that the cold weather will intimidate crops in Florida. While refined or white sugar for March delivery advanced $1.30 or 0.2 percent. The price rose to $723 a metric ton on Liffe exchange, which is the highest closing price since 1989. The price climbed up $734.70 before it was closed at $723. Sugar prices doubled as compared to last year after output of two biggest sugar-cane growers fell. Excess rains in Brazil and weak monsoon in India affected the sugar-cane output, which caused the sourness of sugar.

Nevertheless, on one hand oil surged but at the other struggling dollar slid further. Dollar slid against the Yen striking to the lowest in four weeks. Dropping by 1.4 percent dollar reached at 91.26 yen while the Yen rose against 15 of 16 major counterparts. The event helped Yen to advance 1.7 percent against Swediesh Krona, 1.5 percent against Brazilian real, 1.4 percent against British Pound and it rose 0.5 percent against both the dollar and euro. Meanwhile some Japanese exporters converted overseas earnings into their own currency.

While looking at the indexes then the MSCI World Index of 23 developed nations’ stocks advanced by 0.2 percent and MSCI Index of Emerging Market jumped 0.9 percent heading to its highest close since August 2008. Stock Indexes of energy producing nations surged a lot and were the biggest gainers. KASE Stock Exchange index of Kazakhstan managed to climb 1.9 percent on its first day of trading in the year 2010. Micex of Russia advanced 0.6 percent, while Brazil’s Bovespa jumped 0.3 percent and Canada’s S&P/TSX Composite climbed 0.2 percent.

Dow Jones Industrial Average slipped 0.1 percent while S&P 500 index changed a little and recorded a jump of 0.3 percent. In Europe, Dow Jones Stoxx 600 index slipped 0.1 percent while MSCI Asia Pacific Index managed to climb to a 16-month high.

British confectionary giant, Cadbury dropped 1.8 percent in London as Kraft Foods Inc. sold its Pizza unit to Nestle to raise funds to acquire Cadbury. In New York Kraft Foods rose 4.9 percent while Cadbury reported 3.2 percent drop.

Icy weather boosted the gasoil prices. Recent increase in demand of crude oil helped its price to approach $82 a barrel. Yen advanced against 15 of 16 most traded currencies.

Author: Micheal James
Article Source: EzineArticles.com
Provided by: Programmable Multi-cooker

CHOOSE THE BEST FUTURES TRADING SOFTWARE THAT WORKS

If you’re in futures trading, there’s a lot to deal with tracking contracts as they move thus constantly. It doesn’t matter if you’re doing it for you or have founded a business to track futures for clients. The simplest option to make sure that you stay on top of things is by using software. Because everything is now automated, and things amendment at such high speed, the software that you choose could make or break you – it could literally build the difference between you creating huge profits or huge losses.

So what do you seek for in a very futures trading software? Here are some tips; truly treat them as should haves for any trading software that you decide to buy.

1. It must be ready to update changes while they happen – you want to understand what’s happening because that’s what futures trading are all about. Data can allow you to know whether its time to buy or sell. Any software that you decide on should be connected well enough to get info to you in split seconds.

2. It ought to enable you to test – smart software will enable you a check period. With futures software, you ought to be able to put in dummy information and see if the software actually works. And it should work from beginning to end. You ought to be in a position to pick a product, bid, get instant updates as they happen available and at the end of the day, get your daily totals. It’s suggested that you opt for software that enables you a shot amount of a minimum of 14 days. This manner, you’ll be able to do a dummy run and once you recognize that it works and then you’ll be able to go ahead and actually do live trading. By the time 14 days are up, you may know whether or not it supports your needs. If it’s sensible, then go ahead and create the purchase.

3. If you’re simply into futures, this might not build such a huge difference to you, but if you’ll be able to, source out software that will stocks and also the forex as well. Money markets are totally connected and a twist of events may end up leading you to stocks and therefore the foreign exchange market. You don’t want to begin scrambling around for software at that point when there’s really no time to lose. Search for software that will all three and comes at a cheap price. That means, ought to you decide to spread your wings, you’ll be able to get moving quickly.

4. Opt for software with reputable client service. I cannot over-emphasize the importance of this. If anything goes wrong, you would like somebody at the opposite finish who is able to answer your queries and fix the problem. You don’t wish an answering machine or to be transferred from desk to desk – you’ll be losing cash whereas all this is often happening. Get a service with real people for customer support, who are able to reply instantly to queries and who are technically up to speed.

5. In-house support – typically things get it wrong and you wish someone with the technical expertise necessary to correct them in the shortest time possible. And not over the phone whereas providing you with instructions – you would like them to return over and have observe the system and fix it. Create certain your software comes with this sort of assurance.

Once more, these are just tips, but they can lead you to a great futures trading software.

Author: Lan T Turner
Article Source: EzineArticles.com
Provided by: Netbook, Tablets and Mobile Computing

ALL ABOUT THE FUTURES TRADING SOFTWARE

If you want to use the futures trading software successfully, you have to be knowledgeable on futures trading. For instance, you have to know what a futures contract is. Basically, it is a contract for buying and selling certain commodities on a specific date for a specific price, called the futures price, which is based on the market’s decision. Then, the futures contract will be traded upon the futures exchange. Such contracts cannot be classified as securities akin to bonds or stocks. However, they can still be considered as securities but only as derivative contracts.

The things that are involved in such contracts range from financial instruments to currencies; and also intangible assets such as interest rates or stocks in dices. Then, the date for delivery is also referred as the futures date. And the futures contract’s official price is the agreed price on a business day’s end. The futures trading software that are available have lots of types. And they can be downloaded from the Internet at no cost. But there are also available programs wherein you only have to pay for the hours that you have used the program. Traders look for several features in the futures trading software. They look for regular data updates and live quotes. They also want charts and indicators that can be customized.

But due to the many risks that a future trading has, it is really necessary that you grasp your smart trading software too. You have to understand its features and you must know how to use it properly. You can search for a program that provides tutorial lessons or futures trading exams. In this manner, you will be able to test your knowledge and skills in futures trading; hence, you will know if you are prepared enough to trade huge amounts of real money in the market. Furthermore, you need to have a well-developed plan if you want to become successful in futures trading while using a software. And sometimes, when you got a bad trade, accept it and do better next time. Record your trades on your futures trading software and analyze each move you make. And to be able to find the suitable software, you can get two different programs and compare.

Author: Roger Kevin Johnson
Article Source: EzineArticles.com
Provided by: Latest trends in mobile phone