How are crude oil futures traded? Crude oil futures investment teaching

How are crude oil futures traded? To trade crude oil futures, you must first open a futures account. If you don't know which futures account to open, the easiest way is to choose from your existing securities account or the list of futures traders on the official website of the exchange. You can pay attention to past articles on futures fees and how to choose futures traders. This article will only briefly describe the relevant knowledge of how crude oil futures are traded!

How are New York light crude oil futures traded?

The main players in WTI crude oil futures trading are crude oil producers and refiners. For individual investors, it is not an easy task to invest in New York crude oil. There are usually three ways:

1. Invest in the stocks of crude oil producers and refiners

In the cycle of rising oil prices, the share prices of listed companies related to crude oil usually rise, so investors who are optimistic about crude oil prices can invest in the stocks of listed companies related to crude oil.

2. New York Crude Oil ETF

The world's largest ETF tracking the price of New York light crude oil is USO, which manages nearly $3 billion and invests directly in New York crude futures.

3. New York Crude Oil Contracts for Difference By trading New York Crude Oil Contracts for Difference products, individual investors do not need to invest as much money as futures trading, nor do they need to pay as high transaction costs as crude oil ETFs, but they can trade the price changes of New York crude oil.

How crude oil futures are traded: profit and loss calculation

For example, the size of the WTI crude oil futures contract is 1000 barrels of crude oil, with a minimum change of 0.01 and quoted in US dollars. If a trader buys a WTI crude oil futures contract at $80, the current price of the WTI crude oil futures contract is $86.

Then the investor's profit is (86-80) * 1000 = $6000.

The above calculation does not include a handling fee. Since each investor's handling fee is different, this part is also a very important cost consideration for investors with high trading frequency. The above case calculation is for reference only. I hope it will be helpful for beginners who do not know how to trade crude oil futures!

For users who don't know how crude oil futures are traded, they can also go directly to Doo Prime.Depu CapitalIt is very convenient to place an order for futures trading on the APP.

After understanding how crude oil futures are traded, we need to know what are the precautions for investing in crude oil futures.

How are crude oil futures traded: Precautions

To understand how crude oil futures are traded, you must understand that futures contract prices are extremely volatile. Due to the time difference between the United States and Europe, when the US capital markets open, the capital markets are closed. Therefore, many investors who hold positions must pay attention to the trend of crude oil prices after the opening of the US market. The price turbulence in the US market will affect oil prices at the opening of the next day, causing extreme phenomena such as gaps, and investors' funds will be lost.

Futures contract swap risk: Crude oil futures contracts require buyers and sellers to buy or sell a specified amount of crude oil at a specified price on a specified date in the future, and settle in cash. Therefore, the swap market sells the contract when the existing contract is about to expire, thereby buying the contract after the expiration date. If the price difference between the two contracts is too large, the investor's funds may be unexpectedly lost.

In addition to the above-mentioned risks in the crude oil futures trading process, futures trading itself also has its own limitations.

Futures trading is not flexible enough: crude oil futures margin ratio and leverage size are stipulated by each futures exchange. Contract specifications are relatively fixed and not friendly to ordinary investors.

Forced position squaring risk: crude oil futures trading to implement the same day no debt settlement system, futures exchanges and brokerage companies on a daily basis for investors profit and loss classification. If the margin in the account can not be replenished in time, then investors will be forced position squaring.

The above is all the relevant knowledge of how crude oil futures are traded. I hope it will be helpful to you. Some people think that it is not easy to predict the rise and fall, but it is relatively easy to predict the long and short trend of the broader market, so they like to operate futures instead. Novices know how crude oil futures are traded, in shortaccount openingDon't buy blindly. By learning more about investment and paying attention to risk management, you can make steady profits on the road to investment.