Futures Trading Basics

Once you understand the basics of futures and options trading, you will face many more investment opportunities. With these investments available to you, you are no longer limited to purchasing stocks and bonds. You can add variation to your portfolio by trading futures and options contracts on commodities, including grains, precious metals, and oil.

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While futures and options are both traded on the derivatives market, there is a basic difference between the two types of investments. While options give you the right but not the obligation to enter into a futures position any time prior to the expiration of the options, futures contracts involve a commitment to purchase the commodity when the future expires. Most investors, however, do not actually take possession of the futures they purchase.

Engage in Futures Trading after Mastering the Basics

You can profit from options on futures trading by selling the option contract before the delivery date, but you need to know more than the basics to find the right time to sell. If you buy back your futures option contracts at the wrong time, you may end up missing out on some of the profit potential. Delaying your buy back, can increase your risk and may result in you taking a loss on your investment.

With the Optioneer program, you will have more than just basic knowledge at your disposal. The technology was developed by an experienced trader and provides you with information based on performance indicators, making it easier for you to act with all the facts a professional would know. To find out more about the Optioneer system or to inquire about our free trading seminars, call us today at 800-845-2502 or contact us at info@optioneer.com.

The risk of loss in trading commodity futures and options can be substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose the full balance of your account. It is also possible to lose more than your initial deposit when trading futures and/or granting/writing options. As a result, selling/writing "uncovered" options exposes the seller/writer to the possibility of margin calls and virtually unlimited risk. All funds committed should be purely risk capital. Past performance is no guarantee of future trading results.

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