Using Commodity Hedging Strategies to Manage Price Risk


Hedging is one of the greatest tools to manage risks involved in commodity futures trading. If possible, the goal of hedging should be concentrated at transferring price risk and setting the prices one will pay or receive within a determinable range.
Trading in Commodity Futures: Be Armed to Steer Clear of Downsides!:
The risk-reward dilemma - It is often said that any form of trading can become dangerously addictive and is a potential threat of serious erosion of your assets unless you are aware of the inherent risks involved. There is nothing like being aware of possible downside in Futures Trading too; it certainly promises to give handsome returns but the flip side must never be ignored. Every investor has an inherent ability to absorb risk and the degree or capability depends upon a combination of many factors.
Six Silver Questions and Perspectives:
The following are a few questions that I fielded from a subscriber. They struck me as questions from a sophisticated outsider, a new investor who also happens to be a financial professional. I thought you mind find the perspective useful...
The Right Path For Trading Success:
When I first entered the markets, I didn't know which way was up. Even the market I ended up starting with, I was hardly able to articulate what it was. It's called a contract for difference (CFD) in case you're wondering. They are not available in the US, but are hugely popular method for trading in many other parts of the world.
Selling the Family Silver:
Figuring out when to jump back in the river and bring it back into the system is a whole other challenge...
Bubbles, Tensegrity and Fragility:
Financial asset bubbles primarily portray the miracle that they can go on as long as they can or that they could somehow be expanded forever. The instigators believe there is no danger of bursting - only a child-like fear of deflation.
Upside Down and Backwards: Here We Go Again:
"There are some ideas so wrong that only a very intelligent person could believe in them." -George Orwell. In a recent widely distributed associated press article, Bond Market Bubble is Looking Fragile, Bernard Cohen correctly (remarkably) identifies the financial bottleneck threatening to once again freeze credit markets a la The Lehman Crisis. Cohen paints the portrait of a bond market panic; the very sort that could easily trigger the type of crash that could "get away" from policy makers and morph into a full blown...
The Financial End Game 2.0:
The events of the past few months seem astounding when taken in all at once. It appears to be a plan to destroy the U.S. dollar and the American middle class.

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