Options Trading Guide

Financial Options Trading Canada Section


Financial Options Trading Canada Navigation


|

Main Trading Home Page
Partners
Tell A Friend about us
Commodity Options Trading Plan |
Demo Options Trading Software |
Trading Understanding Gold Options |
Commodity Futures Options Trading |
Options Trading |
Success Magazine Options Trading Course |
Trading Options In An Ira Account |
Options Trading System |
What Is Options Trading |
Trading Index Options Oex |
Don Fishback Odds Online Options Trading |
Trading Qqq Stock Options |
Futures Options Vs Forex Options Trading |
Online Options Trading |
Financial Options Trading Canada |

List of Options-Trading Articles
List of Options-Trading Links


Financial Options Trading Canada Best seller

Buy it Now!



Best Financial Options Trading Canada products

FOREX KILLER
SOFTWARE
Read more...

 

 

$77 Million
in 2 Years?
Read more...

 

6 Figure Jobs - Executive Job Seeker

 

DAY TRADING
FREEDOM...Read More...Click Here

Stock & Commodity trading
Easily spot market turning points in Stocks and Commodities. Fibonacci and Gann price and time secrets and software. Free 7 day e-mail course.

Intelligent stock trading
A how to guide showing you step by step how to at the very least double your investment every twelve months in the stock Market.

Social bookmarking
You like it? Share it!
socialize it

Newsletter

Subscribe to our newsletter AND receive our exclusive Special Report on Options-Trading
Email:
First Name:



Main Financial Options Trading Canada sponsors

Financial Options Trading Canada

 

$77 Million
in 2 Years?
Read more...

 

 



 

Welcome to Options Trading Guide

 

Financial Options Trading Canada Article

Thumbnail example

This is a selection made from among articles on Financial Options Trading Canada. For a permanent link to this article, or to bookmark it for future reading, click here.

Commodity Options Trading For Big Profits

from: www.TradingExposed.com


The market for trading commodity options is simply a venue where producers of goods are given the chance to purchase or sell a commodity at predetermined and fixed rate. Much like a farmer who is given by an insurance firm the right to collect on a particular plan in the event that his properties catch fire, traders of commodity options may also sell their options at a particular price if prevailing market rates go lower.



There are two kinds of commodity options. One takes the task of insuring products in case their current market price drops, while the other insures products that are bought against price increases.



Buyers in commodity options market have the right and not the obligation to exercise their options.



Case in point, if a person decides to sell soybeans for $4 per sack, the commodity options market is the one that provides the opportunity for a trader to do so by paying the rate that has already been pre-agreed. If each sack is currently priced at only $5 each, then the commodity options trader has the option to sell his holdings for only $5 an then pocket the extra $1 as profit from his exercise.



Commodity options has two basic types: the call option and the put option. The call option gives you the right to buy the underlying commodity, while the put option gives you the right to sell the underlying commodity, all based on the price that has already been set.



Here are some common jargon used when trading commodity options:



Underlying commodity



This does not refer to the commodity itself, but the futures contract for that particular good. For instance, the option for December corn is the option for a December delivery of the corn future contract.



Strike price



The rate that was predetermined and set before the options were distributed is the called the specified price or the strike price. This is rate by which the underlying commodity may be traded at any time within the given time frame in the options contract.



Expiration



Commodity options' value are based on the future contracts of the underlying commodity. Thus, there is a given date upon with the options are expected to mature and expire. Options traders can choose to hold on to their assets until the last minute in the hopes of obtaining a bigger value for their options, but analysts caution against this because the longer you hold on to the options, the greater the risks involved.



Traders who were unable to exercise their options are likely to see their holdings turn void and worthless once the expiration date has lapsed.



Option premium



This is the amount that is paid to the option writer to obtain the rights granted in the option. It is determined by public voting and is likely to change every day.



There are still many things that need to be discussed about commodity options trading and it is simply not enough to read one article about it. Scour the Internet for more information or ask the experts about it. Do not attempt to enter this industry if you are not armed with at least the basic concepts.


Christine P. Gray is a recognized authority on the subject of online trading. Her website Trading Exposed provides a wealth of informative articles and resources on everything you will need to know about Options Trading. All rights reserved. Articles may be reprinted as long as the content and links remains intact and unchanged.



Other Financial Options Trading Canada related Articles

Futures And Options Trading
Options Trading Software
Options Trading Video Or Dvd
Futures Options Trading
Stock Options Trading

Do you want to contribute to our site : submit your articles HERE

This space can be enabled / disabled from your admin panel!

Financial Options Trading Canada Specific links

Financial Options Trading Canada News

No relevant info was found on this topic.