To trade commodity futures well is not an easy task.
An old commodity broker friend who was only half joking once told me that if you are thinking that it is a good idea to trade commodity futures you should have a nice glass of wine, go to bed, and take a long nap until the urge has disappeared. For most people who want to jump into the frenzied world of commodity trading that would be good advice.
However, for those who take the time to learn as much as they can about the commodity trading business before trading real money there is the possibility of starting out with a modest amount of risk capital and trading your way to a fortune. It is important to realize that you will be competing against some very smart, well informed individuals who will be pleased to take your money, so be sure to be up for the action before getting started.
It is also important to know that you will never have complete information about any market and that the outcome of each commodity trade can not be known with certainty in advance. While it is important to know as much as possible you must be able to operate knowing that you will never know everything. If you are unable to pull the trading trigger when your trading system indicates a favorable trade is being offered you had best give up commodity trading right now. Since commodity markets can and sometimes do move at blinding speed even tiny delays in executing trades can be fatal to your results.
You just may be lucky for a short while when trading against aggressive seasoned commodity traders but probably your luck will soon turn into financial grief. So beware. Don't be in a hurry to start trading before you at least have put together a trading plan and have decided how much capital you are willing to put at risk. Many brokerage firms offer a demo trading account so that you can put your trading skills to the test without risking real money. For many potential traders opening and trading a demo account is a good way to start.
There is another very important item that you must decide upon before starting to trade commodity futures. You must choose a commodity brokerage firm. You may also wish to select a commodity broker although these Internet days you may decide to trade online in a self directed account using a trading platform provided by your brokerage firm. You must do your homework to insure that the brokerage firm that you are dealing with is not running a scam.
The Commodity Futures Trading Commission (CFTC) offers guidelines to help you with your home work. Before opening an account you should visit the CFTC website. The CFTC will not assist you to make winning trades but they can help you with your commodity trading education which may very well help to get you started in the right way.
An old commodity broker friend who was only half joking once told me that if you are thinking that it is a good idea to trade commodity futures you should have a nice glass of wine, go to bed, and take a long nap until the urge has disappeared. For most people who want to jump into the frenzied world of commodity trading that would be good advice.
However, for those who take the time to learn as much as they can about the commodity trading business before trading real money there is the possibility of starting out with a modest amount of risk capital and trading your way to a fortune. It is important to realize that you will be competing against some very smart, well informed individuals who will be pleased to take your money, so be sure to be up for the action before getting started.
It is also important to know that you will never have complete information about any market and that the outcome of each commodity trade can not be known with certainty in advance. While it is important to know as much as possible you must be able to operate knowing that you will never know everything. If you are unable to pull the trading trigger when your trading system indicates a favorable trade is being offered you had best give up commodity trading right now. Since commodity markets can and sometimes do move at blinding speed even tiny delays in executing trades can be fatal to your results.
You just may be lucky for a short while when trading against aggressive seasoned commodity traders but probably your luck will soon turn into financial grief. So beware. Don't be in a hurry to start trading before you at least have put together a trading plan and have decided how much capital you are willing to put at risk. Many brokerage firms offer a demo trading account so that you can put your trading skills to the test without risking real money. For many potential traders opening and trading a demo account is a good way to start.
There is another very important item that you must decide upon before starting to trade commodity futures. You must choose a commodity brokerage firm. You may also wish to select a commodity broker although these Internet days you may decide to trade online in a self directed account using a trading platform provided by your brokerage firm. You must do your homework to insure that the brokerage firm that you are dealing with is not running a scam.
The Commodity Futures Trading Commission (CFTC) offers guidelines to help you with your home work. Before opening an account you should visit the CFTC website. The CFTC will not assist you to make winning trades but they can help you with your commodity trading education which may very well help to get you started in the right way.
About the Author:
When you trade commodity futures you need to make every effort to at least start out on a fair and level playing field. Choosing an experienced and reliable commodity brokerage firm is critical to your trading success. For some ideas about how to do this and some tips from the CFTC visit Trade Commodity Futures
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