Economics and Finance
Economics and Finance
  • Home
  • About
    • Terms
    • Study Abroad
  • Economics
    • Friedman
    • Economics News
    • Videos
  • Finance
    • Finance News
    • Video
  • Contact
  • Publish
  • Under 100
  • Home
  • About
    • Terms
    • Study Abroad
  • Economics
    • Friedman
    • Economics News
    • Videos
  • Finance
    • Finance News
    • Video
  • Contact
  • Publish
  • Under 100

Why Speculators are attracted to futures market?

8/19/2016

0 Comments

 
Picture
The speculators are investors that profit from price changes, they usually buy when the price of financial instrument is low and sell when the price is high. The speculators are highly interested in futures market due to potentiality of high profits. 

The cost of transaction in futures market is low

The speculators are interest because the transaction cost in futures market is low compared to other types of market such as stock market. 

The futures market is open to all the investors 

The speculators are interested in futures market because the futures market is open to all traders regardless of the size of the traders investment. All the traders have relatively equal access to the futures market. 

The margin and high leverage in futures market

The traders do not pay the full price of the futures they can only pay the margin of the futures to trade, therefore the leverage is high which leads to high profit, but it also means high loss. For example, if the futures price is $1000, the trader can trade that with only $100 or in some cases as low as $10. 
0 Comments



Leave a Reply.

    All the articles are short and random.

    Archives

    August 2017
    June 2017
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016

    Categories

    All

    RSS Feed

About

About 
Terms
Contact
​Site Map

Topics

Economics
Finance

Picture
© COPYRIGHT 2015. ALL RIGHTS RESERVED.