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Profit in the Futures Market!

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Profit in the Futures Market!

Insights and Strategies for Futures and Futures Options Trading

Bloomberg Press,

15 min read
10 take-aways
Audio & text

What's inside?

You think you can make more money by trading options in the futures market. Think again.

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Editorial Rating

8

Qualities

  • Applicable

Recommendation

Author Jake Bernstein puts an exclamation point in his title but fills his pages with abundant cautions, caveats and confessions. This is a voice deepened by an endearing hubris, a Dutch uncle lecturing his aspiring nephews on the dangers of speculation in futures, knowing the dumb ones should be appropriately daunted and the smart ones will hear his wily insinuations that this can actually be a very good thing, if they get it. If you are a successful securities investor thinking about speculating, this will make you keep your eggs in several baskets, even though the author shares hundreds of tips. If you wonder about the significance of puts and calls, hedges and options, this is a useful, precise and unambiguous lesson. Futures trading is not an investment; it is high risk speculation. Each trading strategy requires substantial time and money, and even the best fail half the time. getAbstract.com recommends this book to investors who need a Dutch uncle to quell their urge to risk their kids’ college funds - first, listen to good old Uncle Jake.

Summary

The Future: It’s Biblical

Begin to consider futures trading with a tall stack of reservations. Unlike stock trading - where the goal is to profit from an appreciation of the amount invested - the goal in futures trading is to profit by predicting volatility often precipitated by ephemeral if not Biblical variables: weather, consumer confidence, strikes, panic, political upheaval, pestilence and mania. Since volatile futures markets offer futures traders greater risks than stoic futures markets, they also offer far greater potential to convert speculative capital into profit. Because intangibles and events beyond human control have a huge impact on the price of commodities, American commodities traders had to hedge their risks in the nineteenth century by developing a speculative futures market, averaging out the highs and lows.

As a matter of definition, futures are contracts to purchase a commodity on a specific future date for a specific future price. The commodity, say wheat, will probably still be seed when the deal starts. The wheat futures speculator looks at a mass of data, including last year’s supply and demand, harvests and stores worldwide, weather forecasts...

About the Author

Jake Bernstein is president of MBH Commodity Advisors Inc., which offers a wide range of trading services and products. He often lectures at seminars and investor conferences. He is an internationally known commodities analyst, trader, financial consultant and author. His articles have appeared in Barrons, Futures Magazine and Money Maker.

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