Forexon.net

WealthCap offers managed futures funds which lets the investors make such esoteric plays as shorting currencies and betting on cattle prices. It is basically a strategy used by some hedge funds and the two types of investment vehicles are close that many financial firms lump them together.

Managed futures funds can be considered since this fund is for investors who require investments that have a low correlation with traditional asset classes, such as equity and fixed income investments. WealthCap provides superior investment returns through investment in a diversified portfolio of commodity contracts, while reducing the risk of loss of capital through the implementation of prudent risk controls.

This funds also suits investors who are willing to tolerate a high degree of volatility. It is a good alternative for enhancing the risk-adjusted returns of a diversified portfolio. If you are a qualified investor with a diversified investment strategy, you may want to consider adding managed futures investment to your total long-term financial plan.

Like other managed futures and hedge funds, WealthCap tries to boost its returns by Investing with lots of borrowed money, which allows it to buy contracts with face values that far exceed invested equity, losses and magnifying potential profits. Both hedge funds and managed futures funds tend to favor risky and secretive investing methods.

You can get the following potential benefits of managed futures

1. In any economic environment, you have the ability to gain (or lose)

2. The returns have been historically non-correlated to the stock or bond markets.

3. You have the monthly redemption rights (some funds may have a 12 month redemption penalty)

4. There is ease for diversification.

Managed futures funds may employ leverage and might acquire positions with a face amount of as much as six to ten times or more of its total equity. The leverages magnify the effect of both profits and losses. The potential of being profitable in any type of economic climate makes the managed future funds more demanding since the trading advisors have the flexibility to go long (buy in anticipation of rising prices) or short (sell in anticipation of declining prices).

Hence this ability to go long and short gives managed futures the potential to profit (or lose) in times of

1. Economic strength or weakness

2. Inflationary or deflationary environments

3. Energy abundance or crisis

4. Upheaval or political stability.

Managed futures can provide exposure to many of the world’s largest economies through currencies and interest rates that may enhance the portfolio diversification. This may help to balance portfolio returns in difficult market environments. The difference between private and public managed futures funds is that public funds are ideal for qualified retail investors and private funds are open to investment by high net worth and accredited investors. Investors who are financially eligible and willing to accept managed futures inherent fluctuations should consider managed futures investments.

For more details please visit www.wealthcapfund.com

Mark Plummer

http://www.articlesbase.com/investing-articles/managed-futures-funds-128314.html

Futures markets were started in Osaka, Japan in the 1600s to create an authoritative and meaningful market price for agricultural products, using standardized contracts. Since then, futures markets have been copied around the world to allow the hedging various future risks, financial and other. In the United States, the Chicago Mercantile Exchange and the Chicago Board of Trade have been the most popular Futures Trading markets. Although futures markets are changing and becoming more electronic, they are still important risk management tools for farmers and present financial opportunities for all manner of hedgers and arbitrageurs.

Complete course materials are available at the Open Yale Courses website: http://open.yale.edu/courses

This course was recorded in Spring 2008.

Duration : 1:12:10

Today’s market takes root in the agriculture markets of the 19th century, when farmers began to sell contracts to deliver their crops at a later date. This was done to anticipate the needs of the market and stabilize supply and demand during poor crop seasons. Like goods and services, the contracts themselves soon became seen as valuable. A grocery store chain, for example, might want to bid on such a contract to ensure that they, and not their competitors, have fresh strawberries during the winter.

1. The Futures Market

The current futures market, of course, includes far more than just foods! It is a market for all sorts of commodities including manufactured goods, agricultural products, and financial instruments such as currencies and treasury bonds. A futures contract states what price will be paid for a product at a specified delivery date.

2. Playing The Futures Market

When an investor plays the futures market, the actual goods are not important and there is no expectation of a real delivery. After all, locusts or the elements of nature could destroy the crop. As such, the value of the contract itself changes daily according to the market value of the commodity.

3. How Transactions Work

A futures contract has a buyer and seller. The contract specifies the buying price, a quantity of goods, and a delivery date. You can never lose money on a futures trade – you will never pay more than the initial amount of the contract. By locking in prices at a fixed rate, you ensure that you will still get that price years from now, protecting against price raises. On the other side of the coin, if the value of the commodity drops, the producer will make money.

4. How Is Profit Made?

In the end, investors are hoping to profit from the daily fluctuations of the market. They buy long term contracts and hope the market will rise the value of the commodities. This way, they can buy low and sell high. Alternatively, those wishing to sell their goods can offer short term contracts if they expect the value of those items to go down.

5. The FOREX Market

FOREX is trading in currencies. It is therefore very liquid in nature – you will never get stuck with two hundred boxes of strawberries that have to be sold within 2 weeks or they will go bad and youll lose a lot of money. Far, far less slippage occurs in the FOREX market compared with the futures market. Slippage is a term that refers to you losing money.

6. Always Open

While most futures exchanges can happen 7 hours in any given day, FOREX is open 24 hours a day for trading. This makes futures far more liquid, able to take advantage of trading opportunities as they arise.

7. No Commission

Traders pay a fee for each transaction they enter into instead of having to pay commissions to brokers. There is a very high volume of trading FOREX transactions are almost instantly executed. This minimizes slippage and increases price certainty. Brokers in the futures market often quote prices reflecting the last trade – not necessarily the price of your trade.

John Morris

http://www.articlesbase.com/finance-articles/forex-versus-futures-market-what-is-the-difference-63379.html

Does Daytrading pattern rule apply to Index Futures Trading?

I don’t know what “daytrading pattern rule” is. can you explain?

I am certain that oil prices are going higher mid to long term.
1-Can someone explain to me how far out I can get a contract?

2-Can I buy a futures contract that expires several years from now?

3-If so can I sell it any time I want, or does it have to be on that date exactly?

4-What is the leveraged amount? When are margin calls made?

5-Lastly how does an amateur investor trade futures (where do I start)

Yes, I am certain that prices are going up dramatically very soon. This is based on peak oil, my research into geology and economics. Thanks a million (pun intended)

The best way an amateur trades futures would be by using an option. While the payoff is less, so is the risk.

By using an option instead of the futures contract, you will be able to get the experience you want, without subjecting yourself to margin calls.

Furthermore, you can buy an option much further into the future than a futures contracts. Remember, though, the further out in time you buy your option, the more expensive it becomes. Additionally, because it is impossible to predict where the markets will move, the more capricious your investment has become.

You should be able to buy a Crude OIl option roughly six months from now for about $1500.00, that’s “close to the money”.

” The money” is the current trading price for the underlying commodity. For example, if oil is trading at 65.00 bbl., you could buy a 66.00 “call option” for about 1500 dollars.

To calculate the price of an option, you multiply the option closing price by the contract size. Oil is traded in 1000 bbl increments, so if you are quoted 1.10 on a $66.00 September call option for 1.10 that would mean the price is 1,100.00

You can sell your options or futures contracts whenever you want. This is why we have the futures exchanges. It’s just like the Stock Market. You can buy and sell freely on the open market.

Don’t forget though, when trading options, that the closer you get to expiration, the more rapidly the option declines in value. This happens because if you’re not “in the money” (your option is lower than the current market price) the time that you have to make a profit is running out.

On expiration, if you are not “in the money”, your option disappears and you have lost your investment. Had you been trading futures however, you would be required to make up any difference in price (thus, margin call).

Futures Trading is highly speculative and you should never “gamble” with money that you can’t afford to lose.

Try www.tradeamerican.com and peruse their website. I know they have some on-line information that you might find useful.