HOw lucrative is the futures market??

Question

Commodities ect..........

Answer 1

Very lucrative, if you are a broker. If you are an investor, it can be a good diversifier, because commodities tend to have low correlations with stock and bond markets. The key is not to overinvest in commodities...

Answer 2

Futures are done with margins (loans) so you could take $10,000 and move $100,000 worth of futures. The reason why you can move $100,000 is because you had actually made a loan for $100,000. So if whatever goes to zero you didn't lose $10,000, you lost $100,000 (plus fees). On the other hand, you can make 10 times the money of the movement so you gain 50 cents for every 5 cent of movement in your favor.

Answer 3

High risk with high returns or high losses.