Market Forecasting - It Really Works!

By Rick Ratchford  

Just like most traders, I started out trading Stocks, Futures and Commodities by way of the news, Government reports, crop reports, the occasional tip, and a gut feel. Needless to say, these were not very effective.

But then, during the late 1980's, I became more aware of price charts and a few chart indicators.

The chart indicators got me excited, as I thought at the time that I had stumbled upon a way to know in advance what the market was going to do next. The Stochastic oscillator was really intriguing, and it almost appeared to predict when the market would move up or down.

But again, like most have discovered, these indicators don't really predict. How can they, when they are simply based on averages, or volume, or a slew of other historical data backward monitoring divide by two forward projecting algorithm that has no more connection to the future than five dice in a shaker cup!

Now don't get me wrong. Chart indicators are pretty useful and I continue to use them today (now 3 decades later). However, market forecasting is NOT what these indicators do best. They do, however, give us a lot of useful information that...

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Using Commodity Hedging Strategies to Manage Price Risk

By Patrick Sekhoto Exclusive low rates!

Commodity traders make profits primarily through two different ways; speculation and hedging. The latter is a risk management strategy used to protect an investment against losses and shielding its profits. Consequently, the former is a more aggressive strategy, purely driven by profit. Even though the two strategies can be used at the same time, it is critical for traders to understand how hedging works and why it is necessary. Ideally, commodity hedging strategies are one of the basic tips to profit selling commodities. Here is a quick outline on how to use this simple strategy to maximize your profits exponentially.

What is a hedge fund trader?
A hedge fund trader is an individual or company that involves in a business related to a specific commodity. Preferably, a hedge fund trader could be a producer of the commodity or rather a company interested in purchasing a commodity in future. Hedging allows each party to limit their risks in the commodity markets.

Why do traders hedge?
It is not possible to predict the direction commodity prices are taking with 100% accuracy. Apart from the direction of prices, traders also need to know the specific time frame for such changes. Instead of stressing out to get these two factors right, traders can opt to make more profits by using the hedging strategy.

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