When the stock market is closed, and you have a position in a stock, your hands are tied. If an opportunity arises outside of market hours, you can't take advantage of it, and worse, if you have to exit a position, you can't until the market opens the next day. [...]

I was trying to explain leverage using futures to my wife. I used terms like Notional and Big Point Multiplier. She didn’t get it. She asked me, where did you come up with this phantom number, and what does notional mean, what’s a multiplier? And she went on and on, […] Read more

A futures contract has an expiration, and upon expiration there are costs and obligations associated with the settlement of the contract. The contract is settled one of two ways, either physical settlement or cash settlement. If you are a hedger, or your business deals in the physical asset, then you […] Read more

Treasury futures are standardized futures contracts used to purchase US government notes and bonds for future delivery. When you acquire a treasury future, you are not obligated to take delivery unless you hold the futures contract through expiration. Only a hedger would do that. I’m assuming you are a speculator, […] Read more

There are two types of futures traders, Hedgers and Speculators. They differ in one primary aspect, the hedger trades in both the cash andPaper or contract markets, where the speculator only trades in the contract market. What do I mean by cash and contracts? Cash is the physical market. For example, in agriculture there [...]