commodity options trading

Money Management: Commissions

The Blog Entry that Accompanies this Vlog is at: investorandtrader.blogspot.com My Daily Blog is at: investorandtrader.blogspot.com My channel at BlogTV is: www.blogtv.com My Podcast is at: airelon.podbean.com and embedded in the daily blog. In the previous entry, I discussed how important it is to consider the danger of overtrading, and how it relates to your account size with a given time period. In the following video, I discuss the enemy of the low funded trader and investor. Commissions. 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 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 risk tolerance
Video Rating: 5 / 5

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Trading commodities……………………..?

Question by RoastGoose: Trading commodities……………………..?
Hi

1. When people say they trade commodities, what do they typically mean?
Do they trade futures? Options? ETFs?

2. Have been reading about traders that make XXXX% on commodities per annum. How is this possible? Do most professional traders trade options?
How do they get that kind of ROI?

thanks

Best answer:

Answer by JoeyV
a) When people say they trade commodities, what do they typically mean?

Futures most likely

b) Have been reading about traders that make XXXX% on commodities per annum. How is this possible?

It’s just lies.

c) Do most professional traders trade options?

Some do, but liquidity is much better in futures than futures options

d) How do they get that kind of ROI?

They don’t include losing trades.

What do you think? Answer below!

Trading stocks!?

Question by Sonny: Trading stocks!?
I want to start trading stocks, options, commodities, futures – does anyone know of any good platform for that? Please help.

Best answer:

Answer by bfdavis1972
Start small and then build! Trying to trade everything in the laundry list of securities you laid out is a recipe for disaster. Start with stocks would be my advice, then move on into options as your experience and understand of the market grows. Then you can branch out further into commodities and/or futures if the situation warrants it. In order to actually trade, I would hook up with an online broker. Look for a mix of price as well as service to help make your decision. I like the discount brokers like Fidelity and Schwab, because they give you low costs (though not the lowest) with the best service, and a lot of great online tools to help you get started with investing. I’d check out both of their websites to see what you like.

I’d also ask one other question-why so gung ho about trading stocks? Do you already have a stable foundation of mutual funds built up? Stocks are sexy but also risky…make sure you build in a safety net.

Know better? Leave your own answer in the comments!

Q&A: Need help finding a broker to trade options?!?

Question by socrates: Need help finding a broker to trade options?!?
My main account is with Scottrade.It is fine for stocks but trading options with them is more expensive than buying stocks. I would like to be able to sell naked puts and calls(for buying spreads,straddles,etc) Suggestions? Also,are there firms that allow you to buy otions of commodity futures or do you have to open a commodity account?

Best answer:

Answer by Radar Man
Interactive Brokers and Thinkorswim are two great brokerages for options that will allow naked selling.
Interactive has cheaper commission while Thinkorswim has the best platform that can analyze any option position.
Both firms can do futures.

Know better? Leave your own answer in the comments!

where can you get good commodities trading advice?

Question by aaron: where can you get good commodities trading advice?
besides getting a bachelor’s degree in agricultural economics, where can you find a reputable broker for futures and options?

Best answer:

Answer by DJTT
From a good broker. Generally they don’t charge either.

Add your own answer in the comments!

Q&A: Stock Options & Commodities?

Question by Mike: Stock Options & Commodities?
Is trading commodities smiliar to trading stock option contracts? Calls, puts, exercising, expirations, etc.?

Best answer:

Answer by got it
yes it is. I’ll tell, you will want to be very careful if you get into this. There are many people smarter than both of us that do this. I don’t even trade them and i have over 25 years experience in finance.

Add your own answer in the comments!

What will it cost me to start trading commodities?

Question by jbsikes: What will it cost me to start trading commodities?
What does it cost to establish an account and start trading? I can start with options. Looking for the lowest bottom line.
I’ll be making my own decisions.

Best answer:

Answer by Tek Coronado
I use thinkorswim.com, no monthly platform fees, and only $ 2,500 to start an account. You can’t find anything lower than that unless its some cheap discount broker with terrible customer service and no live feeds

Add your own answer in the comments!

Has any one done turtle trading and would you recomend it??

Question by RON G: Has any one done turtle trading and would you recomend it??
Have you made any money or would you trade options or commodities instead!!

Best answer:

Answer by jjols
the turtle method became popular in the 90s bull market…of course everyones a trading genius in a bull market though..

Know better? Leave your own answer in the comments!

How Much Money Do I Really Need for Commodity Futures Trading?

I am sure you have seen those late night informercials how to make a million dollars in commodity futures trading. How about an option strategy buying heating oil in the summer because it has to go up in the winter. Well guess what, it does not work that way. Commodity futures trading is the hardest yet easiest thing to do. Too many think this is a get rich quick idea. Well, it is a quick rich slow idea, boring, aggravating at times and simply one has to have enough money to survive the most common choppy directionless markets. Only once in a while are there big moves, unexpected powerful ones. Where were the experts predicting the recent stock market crash( however trend following commodity trading advisors made a fortune). How about the experts who were calling for crude oil to go to 0 ( who knows it might..but again trend following commodity trading advisors made a fortune).

After being involved as an investor as well as a commodity trading advisor in commodity futures trading since 1994, I can tell you if you think to start trading with less than 0k you might be better off flushing it down the toilet. This is just my opinion, but as Ed Seykota a legendary trend follower has stated there is no dollar amount too big or too small. The key is following your system or staying with your commodity trading advisor during the eventual draw down. The volatility is so great in the markets currently if you do not have enough money in your futures trading account and you attempt to run a tight stop, just the noise can take you out.

In summation, there is no magic number… however in my first hand experience I would not even suggest with less than 0k

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Q&A: How did Warren Buffett beat the market in the 1950s?

Question by Paul N: How did Warren Buffett beat the market in the 1950s?
Everyone says that Buffett is a “buy and hold” investor and that his favorite holding period is “for life.” But I know for a fact that when he beat the pants off the market in the 1950s, he was basically TRADING… and he even said that he traded commodities options. Does anyone know what his strategy was? Thanks!

Best answer:

Answer by brodis36
Where did you hear this? Warren Buffet has never traded commodities options. After reading his personally endorsed biography, I discovered his strategy was to buy undervalued companies, based on fundamental analysis. Market inefficiencies were more common then, and through careful calculations and analysis he was able to see which companies were most under priced relative to their earnings and book value.

I would be very interested in discovering where you heard he was trading… In the CNBC interview with Buffett which aired last year, he said he was unable to predict short term price swings and therefore never tried.

What do you think? Answer below!