You Want to Be a Futures Trader !

so you want to be a futures ,welcome to our brand. this is our introduction to be learning, how to become a future trader ? in this series you're gonna learn how to find direction.

where to enter into the market where to place your stops where to place your limits equity management,growth plans

we're going to talk about Fibonacci's ,trend line support resistance ,candlesticks ,we're gonna talk about a future broker ,we're gonna talk about what futures, are we're gonna talk about what a tick is , and we're gonna talk about how to potentially generate consistency.

so I appreciate the opportunity and let's go ahead and get started . so because this is the introduction a Article that's exactly what we're going to do we're going to introduce to you what futures are.  So what is futures well future is referred to as forward contracts basically to make it simple that's when one entity and another entity enter into agreement to execute and the future.

here's an example of that okay so again so this says futures and end futures we're buying and selling contracts , okay and so in this scenario we're gonna say there's a farmer okay and this farmer is a happy farmer and this farmer grows corn , now this farmer is going to be referred to as the producer or the seller okay the selling side of the contract the producer this producer grows corn and but the problem is this farmer can't sell their corn until three months from now because the corns not ready needs time to grow so the farmer is gonna worry about price of corn going down because the price of corn falls down too much then there's not even enough profit and selling the corn okay so again we have a farmer known as the producer the seller grows corn and it's gonna watch the price of corn and they're gonna worry about it dropping on the opposite side you have what's called the manufacturer and this manufacturer manufacturers or makes corn bread okay this manufacturer is needs that corn okay Neath the corn to be able to make cornbread it almost like the retail side in a manner okay.

 

 so the manufacturer can't buy the corn until the corns ready which is going to be three months from now so this manufacturer is going to worry about price going up because they're pretty happy assuming they're pretty happy buying the corn now but three months from now the price could be doubled which means it could cut into the profits so you have an entity which is your producer your farmer the wants to sell the corn but can't till three months from now you got a manufacturer that wants to buy the corn but can't until three months from now and they both want to protect their interest and they want to lock in the price okay so what do they do well they enter into a contract and they come to terms of that contract and they say an example manufactures .

I'm gonna buy all your corn for ten thousand dollars and the producer says okay that's fair I'm gonna sell you all my corn for ten thousand but we can't do it until three months from now but let's settle on price so we can both stop worried about running our businesses right so what ends up happening is three they sign this they can't execute on the contract until the producer is able to deliver okay so there's what's called an execution date that's important because inside of futures when you buy and sell contracts there's what's called an execution date which we're going to talk about later on this series make sure you write that down it is very important that you understand how that works now winds up happening three months goes by and you have the corn as harvest the corn is then delivered to the manufacturer or the manufacturer then sends over that ten thousand dollars okay and essentially during this three month process the producer has the right to sell their side of the contract to somebody else to make some money the manufacturer has the right to sell their side of the contract to somebody else to make some money okay .

so how does that work well think about this they came to an agreement to sell the corn for ten thousand what if like a month into the transaction or our month into the waiting period as the corns growing what if that corn is worth thirty thousand dollars well the manufacturer still can buy that corn for ten thousand but it's worth thirty thousand so the manufacturer has the right to sell that side of the contract to somebody else and just pocket the difference hence sounding the contract okay so what do we do as future traders we're buying and selling contracts how do we buy and sell contracts well we have to get what's called a broker okay and your broker your broker is going to give you the ability to place trades on line okay so they're gonna give you like some charts and they're gonna give you the ability to press a Buy button and the sell button and you're gonna have like a symbol list of all these different contracts that you can trade and our