Learn Commodity Trading (Part I)

July 31st, 2009 by Money Manager

Do you like commodity trading? In the beginning chances are you will be overwhelmed by the number of tradable commodities to choose from. There are 32 tradable commodities to be exact. Commodity trading presents both challenges and opportunities. Commodities markets are both broad and deep.

How are you going to decide that you want to trade natural gas or frozen concentrated orange juice, gold or crude oil, soybeans or aluminum, silver or palladium? What about cattle, corn, feeder or copper? Learn candlestick charting.

Much of what happens in the world-from your home mortgage loan to your job depends on the global oil prices and the interest rates. If the oil prices go up, the central banks are forced to raise the interest rates to fight inflation. Do you remember the sudden spike in oil prices from around $60 to $145 during the summer of 2008?Know swing trading.

Just because the global economy has gone into a recession, the demand for oil has decreased. But once the global economy starts to expand again, oil demand will again go up. This can happen again, be ready.

How do you know what is the best way to invest in commodities? So how do you decide which commodity to trade? Should you trade commodities futures, or get stocks of companies dealing with commodities like Exxon Mobil or Starbucks or invest in ETFs or commodities mutual funds. Just getting started in commodity trading can be daunting.

You should know that futures trading is only one way of getting involved in commodity trading. However, as there are many commodity futures contracts that are traded on various exchanges, a lot of investors think that commodity trading is synonymous with futures trading. There are many other ways of commodity trading. Trade Dow Futures.

Between 2001 and 2006, oil, gold, copper and silver all hit an all time high. Many other commodities reached an oil time high. The prices are down now somewhat due to the global recession. Many analysts are of the opinion with the end of global recession the prices of most of the commodities will skyrocket. Do you know that the 21st century is the century of commodity trading?

A long term cyclical bull market in commodities is expected during the first part of the 21st century due to some fundamental factors like the global population explosion, urbanization and the industrialization of the emerging market economies like Brazil, India and China (BRIC).

Commodities are poised for a rally that will last well into the 21st century. However, it doesn’t mean that there will be no minor downturns like that in the present due to the recession. Gold prices are still going higher and higher.

Due to the financial crisis and weakness of USD, wealthy investors are taking refuge in gold. Countries like China, India, Russia etc are buying gold in the open markets that is driving the gold prices higher and higher. Do you want to ride the trend in the gold market? You maybe already late!

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Lets Get Money From The Net

July 30th, 2009 by Money Manager

The request to make money on the internet is something that many people are interested in. This is a manner that has been around for a long time. Hence, you can learn about how to make money. The way it facility in blogging is that your blog will be shortest transfer to a spot that is promotion a result and, when those visitors buy the result, you earn a commission.

The next useful thing you can try enlist marketing. The way they got to the top of the marketing food shackle is by providing the most related hunt results while filtering outmost of the jettison. While it might not be possible to get moneyed and retire early while only working a few hours a day, it is potential to work your affair, devoting the time and exertion it requires, and to make enough money to retire early.

Some of the most prevalent network marketing programs are those unfilled by commission junctio, amazon, and clickbank. In fact, there are many people who want to learn about make extra money. Yes, it is very feasible to make money on the internet. And it’s only getting bigger and bigger.

The good news is, there are very a the behavior to make money on the internet, so you don’t have to feel like you will get stumped burden something you won’t enjoy. It can be a tough question. In truth, suchlike it is you enjoy, there is perhaps a way for you to make money with it.

If you’d like to be in the moment group, eavesdrop up. One of the great effects is, not only are the possibilities almost unlimited when it comes to make money on the internet, the quantity of information you can find about how to make money is almost limitless, and much of it is cool to get. And get paid a bundle.

Access practical points of view in the sphere of car finance calculator – this is your personal knowledge pack.

Learn Futures Trading (Part II)

July 29th, 2009 by Money Manager

Trade Dow Futures and S&P Futures.Day trading E-mini futures has become popular with many individual investors. Apart from professional traders and speculators, futures trading is done by most of the people like you and me who are interested in making money in the markets. “Buy low and sell high”, is the basic premise in futures trading as it is in stocks.

What is different from stock trading is that you can trade futures with leverage on either long or the short positions. This introduces an additional element of risk not present in the stock market.

Another major difference with stock trading is that there is no uptick rule in futures trading. Thus, it is as easy to sell short as it is to buy long. This means that you can easily enter into a position to capture a downward move in prices with no restriction.

How do you manage to survive at futures trading even when you are not particularly good at it? How do you become good at futures trading? The answer is simple. You should have the money first to open a margin account. Then you should have the ability to develop a trading plan that enables you to keep making money in the market long enough to capitalize your next big move.

In nutshell, it means that you won’t be able to trade futures if you don’t have enough money. And you won’t last long in the market if you don’t have a good trading plan. The chances are your money will quickly disappear.

You must know this thing that only 5% of the futures traders succeed and 95% of the people trading futures lose money consistently. You need to have at least $25,000 in your account in order to start trading futures. However, $5,000 is the minimum with which you can start trading futures.

Make sure that you understand the risks involved and that you go into trading futures contracts with realistic expectations when you start trading futures. If you are not sure how to handle the risk involved in futures trading, you can take advantage of the managed futures accounts.

In short, you need money, patience, knowledge and technology to be able to trade futures contracts. Trading futures contracts is truly a hybrid that uses both fundamental and technical analysis.

The fundamental side of futures trading involves getting to know the industry in which you are making trades and the futures contract specifications and seasonal tendencies of the markets. You should also know the important report that you need to keep an eye on.

The technical side of futures trading tells you what the market will do in response to the fundamentals. You will need to develop your own trading style whether it is momentum trading, scalping or swing trading.

Once you know your trading goals, establish a trading plan for getting there. Learn technical analysis. Don’t try to conquer every type of analysis at once. Instead, focus on mastering one item at a time—maybe concentrating only on chart patterns such as the candlestick patterns for instance. Candlestick charting can be a good tool in your technical analysis arsenal. Learn candlestick patterns.

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How About Futures Trading ?(Part I)

July 29th, 2009 by Money Manager

Trade Dow Futures and S&P Futures. The first choice for many investors was and is the stock market. Many small investors are looking for new avenues after getting their fingers burnt during the recent stock market crash. Investors have many choices for investing their money today. Learn swing trading.

If you are among those who take a look at their mutual funds portfolios only once a year than futures trading is not for you. Risk and uncertainty goes hand and hand in money making opportunities.

You will have to get out of the buy and hold investment mentality if you want to take on futures trading. Those who can’t shake off the preconceived notions and discover to make money as the market rise and fall are not successful at futures trading. What it means that those who can embrace the inherent volatility of the world and the markets and use it as a wealth building tool are more successful at futures trading.

Futures trading didn’t have global significance until the 1980 when companies and governments embraced futures trading as financial management tools for hedging although futures markets began in the United States in around 1850s. Futures trading belongs to the 21st century.

Technological advances especially the internet has transformed the futures trading landscape. Today individuals trading futures are on a level playing filed with professional traders and institutional investors.

Now most futures contracts are electronically traded with online order entry and execution. E-mini products have been created specifically to appeal to the individual investors and are now standard among exchange offerings.

There are many ways that individuals can use futures for trading and portfolio diversification. Futures contracts are highly leveraged and marked to the market daily. Futures industry is well regulated and has superior financial safeguards in place to ensure trading integrity.

The chances for sustainable trend that last for decades like that happened in the stock markets during the 1980s and 1990s are less likely. Good services and basic materials will probably undergo major price swings, up and down during the next two to three decades. The volatility of the markets is only going to increase.

The past investors could afford the luxury of buying and holding stocks and mutual funds for the long term (this is what Warren Buffet did in building his fortune). The today’s world calls for a more active and even speculative investor. The new world calls for a trader and futures trading offer one of the best opportunities to make money by trading in volatile times.

However, to change from a couch potato to a futures trader, you will have to work at it or you will be out of the game very quickly. Trading future contracts is a risky business and requires active participation. You need to know the futures market intimately. A winning futures trading plan can help you achieve success!

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What Are S&P Futures? (Part III)

July 27th, 2009 by Money Manager

Trade S&P Futures and Dow Futures. The E-mini S&P futures contract trade almost 24 hours per day with a 30 minute maintenance break in trading from 4:30 to 5:00 PM daily. The monthly identifiers for the E-mini S&P futures contracts are H for March, M for June, U for September and Z for December.Learn swing trading.

If you are a new E-mini trader you be careful as traders are expected to pay for the difference between the margins for the entry and exit points. In case you lose at the end of the day you are likely to pay in a big way. The margin requirements for E-minis are much less than the normal contract. The day trading margin is less than the margin to hold an overnight position in S&P 500 E-mini Futures contract.

All futures contracts are settled daily. At the end of the trading day they are assigned a final value price. The values of all positions are marked to the market each day after the official close based on the settlement price. Based on how well your positions fared in that day’s trading session, your account is then either debited or credited. In other words, cash will either come into your account or leave your account based on the change in the settlement price from day to day as long as your positions remain open.

As losses are not allowed to accumulate without some response being required, this system gives futures trading a rock-solid reputation for creditworthiness. It is this mechanism that brings integrity to the marketplace.

Leverage: The effect of price changes is magnified because futures markets are highly leveraged. You typically pay the price in full with stocks (i.e., without leverage) or on margin (50 percent leverage). Leverage can produce large profits in relation to the amount of your initial margin if you speculate in futures and the market moves in your favor. However, you also could lose your initial margin if the market moves against your position.

Suppose you have decided to put $10,000 into a futures account and you buy one E-mini S&P 500 index futures contract when the index is trading at 1000. Your initial margin requirement for that one contract is $3,500.

Each one-point change in the index represents a $50 gain or loss because the value of the futures contract is $50 times the index. You could realize a profit of $2,500= (50 points) ($50) if the index increases 5 percent, to 1050 from 1000. Conversely, a 50-point decline would produce a $2,500 loss. The $2,500 increase represents a 25 percent return on your initial investment of $10,000 or a 71 percent return on your initial margin deposit of $3,500.

Conversely, a decline would eat up 25 percent of your original $10,000 or 71 percent of your initial margin. In either case, an increase or decrease of only 5 percent in the index could result in a substantial gain or loss in your account. That’s the power of leverage.

It makes your money work harder and produces more in a shorter period of time when everything’s going your way, than if you paid for everything in full, up front. In such a situation leverage can be a beautiful thing. Indeed, leverage is the key distinctive aspect of futures trading as compared with stock trading.

Now suppose you use $5,000 in your account to buy an E-mini S&P 500 contract worth $50,000. However, prices fall by 10 percent instead of going up, and the contract’s value drops to $45,000. Your $5,000 is completely gone. This is the dark side to leverage. You’ll be obligated to put up even more money if the market keeps moving against you unless you get out of the position with an offsetting sale when your maintenance margin level is violated. Leverage is the one ingredient that can produce either horror stories or happy endings. It is extremely important that you fully understand the power of leverage and how to manage it well to get the happy ending.

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