Difference between commodity trader and broker
Be prepared with Kaplan Schweser. From Wikipedia, the free encyclopedia. Day Order An order anyoption en if not executed expires automatically at the end of the trading session on the day it was entered.
Delivery Month See Contract Month. The use of graphs and charts in the technical analysis of futures markets difference between commodity trader and broker plot price movements, volume, open interest or other statistical indicators of price movement. See also Self-Regulatory Organization. You may also be required to travel internationally from time to time. Uncovered Option A short call or put option position which is not covered by the purchase or sale of the underlying futures contract or physical commodity.
Cash Settlement A method of settling certain futures or options contracts whereby the market participants settle in cash payment of money rather than delivery of the commodity. They are generally used to hedge risk. Brokers are also usually given sizeable bonuses and commission payments based on performance.
Option Contract A contract which gives the buyer the right, but not the obligation, to buy or sell a specified quantity of a commodity or a futures contract at a specific price within a specified period of time. Bid An expression of willingness to buy a commodity at a given price; the opposite of Offer. The simultaneous purchase and sale of similar commodities in different markets to take advantage of a price discrepancy.
The international nature of trading means that you may also get the opportunity to work abroad at some point in your career. Option Premium The price a buyer pays and a seller receives for an option. The last day on which trading may occur in a given futures or option.
Margin in commodities is not a down payment, as in securities, but rather a performance bond. Opening Range The range of prices at which buy and sell transactions took place during the opening of the market. Systems that allow participating exchanges to list their products for trading electronically.
Expect early starts and late finishes. A person who, for compensation or profit, directly or indirectly advises others as to the advisability of buying or selling futures or commodity options. The amount of money options buyers are willing to pay for an option in anticipation that over time a change in the underlying futures price will cause the option to increase in value.
The price a buyer pays and a seller receives for an option. Option Buyer The purchaser of either a call or put option. A speculator who will normally initiate and offset a position within a single trading session. Views Read Edit View history.
Typically working for investment banks, clearing houses and broking companies, they trade financial derivatives based on commodities such as oil, gas, metals and food products. An option that has intrinsic value. Time Value The amount of money options buyers are willing to pay for an option in anticipation that over time a change in the underlying futures price will cause the option to increase in value.