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Commodity Futures Trading For Small Investors
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Paper trade accounts surface when traders prefer not to make exchanges using real money. Some experts say you need to set up an account that is specific to it, but some will also tell you that setting up a paper trade can be as simple as having yourself a designated notepad to track your transactions and record charts.
However, before you even think of whether or not it is highly necessary to set up a professionally done or do it yourself paper trade tracker, you must first determine what you plan to trade on. In trading commodity futures, there are a number of options you can choose from.
These include sugar, corn, live cattle, wheat, soybeans, coffee or cocoa, silver and even silver. Some currency trading old timers will say that corn is a good commodity to start with because the corn market is generally predictable and the margins are not too high. You can replace corn with wheat, as they basically move and trade the same way and, sometimes, in conjunction to one another.
If you are thinking about getting into the meat market, live cattle could be another good start as it is considered the safest among the meats. However, there are traders that urge against it because they often result in massive ranges.
Large ranges are what you should try to avoid when trading commodity futures, because the risk of losing is wider.
Examples of commodities with wide ranges are cotton, sugar and soybeans. While sugar was once dubbed as a choice commodity trading product because there is minimal risk to getting into it, current market conditions surrounding it are not so healthy as before and might lead to confusion.
When you are trying to set up a paper trade account with commodities, it is recommended that you start with the lower margin markets, especially if you are just a small trader.
To be able to properly monitor your account, as small traders are advised to simply take the notebook approach, it is best to limit your trades to around 6 to 8. Placing a cap on the number of items you are trading will save you from future headaches and prevent you from losing too much of your money.
While it is true that the more money you have, the greater the number of trading options that are open to you, it is still better to be safe than sorry. If you are a first time trader, you would better take the safe route in so the burn will not be as badly. After all, you are just starting to learn the ropes so splurging on a major investment should be on your agenda at this point.
Trading commodity futures is quite risky, but it is probably one of the safest ways to enter the trading industry. While we cannnot really predict the direction markets will move days, weeks and months from now, a good head on our shoulders, common sense and intelligent inferences will be able to save us from substantial failures.
You do not have to enter commodity futures trading with a bang. Start small, taking one careful step at a time.
Futures Trading Commission News
CFTC Said to Open Inquiry Into JPMorgan Loss - New York Times
 Firstpost | CFTC Said to Open Inquiry Into JPMorgan Loss New York Times By BEN PROTESS WASHINGTON — A federal investigation into JPMorgan Chase's multibillion-dollar trading loss widened Friday as regulators pursued a new line of inquiry. The Commodity Futures Trading Commission opened an enforcement case, people briefed ... CFTC opens probe into JPMorgan trading loss - source CFTC opens probe into JPMorgan trading loss: source CFTC Proposes Easing of Dodd-Frank Speculation Limit Rules |
CFTC approves expanded grain trading hours - MarketWatch
 Bloomberg | CFTC approves expanded grain trading hours MarketWatch CHICAGO (MarketWatch) -- The Commodity Futures Trading Commission has approved CME Group Inc.'s (NASDAQ:CME) proposal to expand electronic grain futures trading to 21 hours a day, up from the current 17-hour schedule, the exchange announced Friday. CFTC Approves Expanded CME Trading Hours Floor Traders Upset Over CME Group's Changes After protest, CME grains set for nearly non-stop trade |
Tester: Firings needed over commodities trading scandal - The Missoulian
Tester: Firings needed over commodities trading scandal The Missoulian Speaking about financial reforms with The Billings Gazette editorial board, Tester said Gary Gensler, chairman of the Commodity Futures Trading Commission, should be fired for the government's role in the collapse of MF Global, a trading house accused ... |
CFTC opens probe into JPMorgan trading loss: source - Chicago Tribune
CFTC opens probe into JPMorgan trading loss: source Chicago Tribune (Reuters) - The Commodity Futures Trading Commission (CFTC) has opened an investigation into possible wrongdoing at JPMorgan Chase & Co in connection with the bank's multi-billion-dollar trading loss, a source familiar with the probe told Reuters. |
CFTC ICE: Money Managers Turn Net-Short On Crude Positions - Wall Street Journal
CFTC ICE: Money Managers Turn Net-Short On Crude Positions Wall Street Journal ... long bets in light, sweet crude-oil futures and options on the ICE Futures Europe so much that as a group they are now net-short on the market in the week ended Tuesday, according to data released Friday by the Commodity Futures Trading Commission. |
Handler Thayer Family Office Alert -- The Commodity Futures Trading Commission ... - MarketWatch (press release)
Handler Thayer Family Office Alert -- The Commodity Futures Trading Commission ... MarketWatch (press release) As a result of these changes, family offices that trade in commodities and derivatives should review their compliance with applicable law. During the first quarter of 2012, the Commodity Futures Trading Commission (the "CFTC") radically overhauled the ... |
US CFTC expected to ease trading curbs: sources - Reuters
 AllGov | US CFTC expected to ease trading curbs: sources Reuters By Alexandra Alper | WASHINGTON (Reuters) - The Commodity Futures Trading Commission is set to make it easier for traders to avoid triggering curbs aimed at reining in speculation in commodities markets, according to two people briefed on the matter. CFTC Considers Loosening Dodd-Frank Speculation Limits CFTC may change application of speculative limits Senators Urge Regulators To Act On Speculative Trading Limits |