Buying a futures contract is said to acquire a long (long) or possession of a long position. Owner long futures position may receive the supply of real goods, if the futures position will last until the date of delivery.
you may have met with the term "shorts". The rules governing futures trading, allow you to sell a futures contract before you bought it (short sale). In this If they say that you have a short (short) futures or short position. From you will be expected to supply the actual goods, if you hold on a short futures position before the delivery date. To close the short futures position, you buy on the stock exchange an identical futures contract. Thus, you get out of market. The very idea of \u200b\u200ba short position may cause confusion, since it comes to selling what you do. In fact, you probably already have participated in short sales, not even knowing it. If a car dealer did not have parked the car that you wanted him to buy, and he had to order it for you at the factory, he made a "short" sale of the car. Furniture, too, is often sold in "short" retail stores to its production.
futures market for every long position has a short position
Why would someone sell short a futures contract? To establish its selling price, because he believes that the market moves down, and he will be able to buy a futures contract later at a lower price. Regardless of toyu which the transaction was executed earlier, a gain or loss in futures trading is the difference between the purchase price and sale price.
Long and short positions - is that most distinguishes futures markets on stock markets. Most stock market investors buy shares for dividends, hoping for their reassessment by the market. Only the most sophisticated investors open short positions. Therefore we can assume that anyone who has any share, may get her some profit. Assume that the shares of "General Motors" in today's trade moved from $ 68 to $ 69. If there are no short positions in these stocks, and none of the existing shareholders are not paid more than $ 68 per share, each holder of shares of GM will make a profit. In our example, their income increased by $ 1 per share.
Not so things are on the futures market. Here, for every long position has a short position if you're in the market and decide to buy a futures contract (ie you have a open position), then another market participant must take the other side of the contract and sell it to you. If you sell short a futures contract (closed position), someone somewhere has to buy it from you. This is the only way to create a futures contract. Therefore, the profit on one side of the futures markets are from someone's pocket on the other side of the market. What wins the long side, loses short and vice versa. It can serve as a sobering factor: if you make money in futures markets, remember: they do not appear out of thin air - you take away their other players.
If you make a profit in the long futures positions, the counterparty loses the same amount in a short position.
Source: http://www.currency-trading.ru
0 comments:
Post a Comment