Hedging Futures by Carley Garner
Trading futures contracts outright can be challenging and expensive for those in the wrong place at the wrong time. How can you mitigate risks without reducing your buying power? Here are some strategies you can apply.
Beginning commodity traders tend to migrate to the practice of trading futures contracts as opposed to options because trading futures seems simpler. After all, a futures trader has the ability to place a stop-loss order, easily determine his profit & loss with absolute certainty based on incremental price movements, and has nearly 24-hour liquid market access. However, there are some flaws in this thinking ...