Futures Market Explained
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- čas přidán 14. 10. 2024
- Farmers use various tools to control the many risks in agriculture. Watching the weather influences when they plant or harvest. Buying crop insurance and selecting farm bill safety net programs helps protect them from crop devastation. But they can also manage some of the threat posed by volatile market prices by participating in the futures market. Farmers can get a feel for how that works if they play Commodity Classic, an online teaching tool that uses fictitious bushels of grain in a fake futures market.
But here at Harvest Public Media, we wanted to better understand how the futures market helps both producers and users of a major commodity, such as corn. And how the benefits trickle down to regular food consumers. Here’s what we learned.
This is how finance should be explained. Like to a child, and then that child goes and explores the subject because now the basic understanding is strong, making it easier to understand the complexity of it all.
I learn finance, stock, crypto, trading and investing... and found the best explanation about futures market in a agriculture youtube channel hahaha,,, that's funny, ironic, but that's a good thing to found this!
but i still don't understand. she has corn + futures contract.
price goes up, she sells her regular corn, because she makes more profit
price goes down, she uses futures contract, because this protects her from selling at a loss
but what happens with the futures contract when price goes up? she just holds on to it?
maybe a "toddler" version would help me understand....
And then gambles it all on calls and options.
@@ziggytonumaa Futures contracts have a specific delivery date. They are a contractual _obligation_ to sell or buy at the agreed-upon price. When the time comes, she _has_ to sell her corn at that price, and the cereal company _has_ to buy it - regardless of what the current market price of corn is at the time. This is the whole point of futures: to hedge against unpredictable and unfavorable moves in market price, by locking down a price for a delivery date ahead of time.
What happens if the sellers production did not meet the quantity specified in the contract?
Amazing , I should sign this contract with my gf.. She can't leave me when my value goes down.. Amazing 😅
This is called marriage... If there would be no marriage, you would leave her easier when you don't like her
Remzi Meriç Ceylan 👌
@@PUNEETKUMAR-kn5gz
So how about the kids?
Liability?
Or further future investment?
Rofl
if only marriage contracts can be traded...imagine that lol..
THIS VIDEO DESERVES MORE THAN A MILLION VIEWS FOR THE CLARITY AND FOR THE EFFORTS THAT WENT INTO IT. SUBBED.
Congrats on your growth, I started trading in January on a 10 k account which has grown to 48 k, the broker I use offers Ai and bots for trading which I took advantage of by contacting their live support. I have been taking advantage of it so far. Your channel is also an inspiration
Wow, that's good
What broker do you use and how much is the minimum I can start with
Pathstonesecurities
I think with as low as 200 you can get started but I advice higher capital for proper trades
Nice, I think this is a safer way for people like me who rarely trust other people to trade for them, thanks for sharing I will opt for bots
Thank you, I looked them up, registered and just funded my account so I will start trading after Easter
Amazing to see someone else talking about this broker, I have been trading with them for 2 years plus and I even introduced most of my friends and close ones to it
Perfectly balanced, as all things should be.
Paris Cloud just watched endgame
i understood that reference
What a bizarre concept.
Just wonderful, I've been looking for "most successful options traders" for a while now, and I think this has helped. Have you heard people talk about - Winoorfa Option Olegroson - (do a search on google ) ? Ive heard some amazing things about it and my friend got cool results with it.
Can I just say, I love who ever created this! Like holy heck, this is the way finance needs to be explained. Break it down, don't complicate, be mindful the users ay not be hip to industry jargon. I love it. Wish you could make more videos.
Totally agreed. This was great
i was thinking why would a person risk of sticking with only one price when he can be ultimately facing huge losses. after this video i understood how this really works . This was absolutely brilliant
so easy to understand , sometime is easier to understand than a sophisticate college lecture. thank you.
I'm looking to get a new job as a commodity trader and this helped so much in explaining how this whole system works. Thank you so much!
Six years later I've finally found this video. I love it with all my ❤. Thank you.
I can't believe that I'm able to understand futures.
Thank you very much for this amazing video.
Excellent video. I also enjoyed the attention to detail, like when the farmer got upset the moment low corn prices was bought up @0:51
Great breakdown of trading strategies! Really loved the tip at [2:42] - super insightful! Keep up the great work!
futures are standardized and exchange traded contracts, what you explained in your video is a forward contract
1. Buying and selling prices are complex
2. Contract look organizable
3. Selling strategy with a futures contract is smart
4. Futures contract is balanced indeed
Came for the knowledge, stayed for drawing! Great work
As an engineering student who start to reads about investment. This video really helps a alot
Thanks :D
Since I joined Trading,I’ve learned a lot. I didn’t learn only from Lukasz Wilhelm and the moderators, but also from the people in the chat. the pre-market preparation with and the swing trade analysis . I’m glad I made the decision to join the IQD Momentum strategy team!
Soo much better then I guy with a whiteboard
This is glorious, I been tryin to find out about "price trends" for a while now, and I think this has helped. You ever tried - Piyatthew Forexify Trends - (should be on google have a look ) ? Ive heard some unbelievable things about it and my colleague got great success with it.
uh, no?
this video just says "contract. there for profit"
The whiteboard video actually explains the steps and terminology.
A good video needs to show each step when a price changes.
And it needs to explain how a contract is sold or bought to a third party without the other end of the contract changing.
Talking really slow, and empahsizing words like "BUY", and "CORN" and pretty pictures don't actually explain the underlying concept.
The biggest confusion can be that the buying and selling of the underlying asset is separate from buying and selling the contract. And the contract has two sides, a buyer and seller of the asset.
Also, while when a futures contract is sold, simply saying a contract is sold is incomplete. It needs to be specified whether the buying side or the selling side of the contract is sold. Both sides of the contract aren't sold.
If you want to learn the actual inner workings of how things work, instead of just thinking you understand something when all you know is the concept at a superficial level (and thus won't be able to explain it properly yourself), watch the "whiteboard" video
czcams.com/video/nwR5b6E0Xo4/video.html
Or a blackboard
.o
Lol
just started college and this was one of the first things in my text book and i got lost really quick. This video REALLY helped me understand what was going on. Thanks!!!
This was both really adorable and incredibly helpful for helping me understand Futures.
I thought it was to maximize profit but I now understand that is a risk management tool for both parties
One of the most effective teaching videos ever seen!
Nice video, and good explanation. This is about Forward Contracts, which are Over-The-Counter contracts, unlike the 'Futures', which are standardized exchange traded derivative contracts.
I mean JUST WOW, Mme u are truly AMAZING At making this kind of videos, The way how to get the Info in our mind with a WOW production . THANK U SO MUCH❤
Best examination i was able to get on CZcams and I like the agribusiness risk management perspective. That was exactly what I wanted.
Wow, this is so easy to understand. thank you so much for the video and your great affort.
Incredible explanation... Now this is what teaching really is!
Thnx for making me understand this. Great video!
Brilliant Video! you really made a complicated concept easy to understand
Ma'am you have explained this concept beautifully...thank you very much ma'am for this effort😊
Thank you so much for this video. I shared it with my 10 year old daughter :-)
Well explain showing support and appreciation for the content all the way from the Land of Mt.kILIMANJARO. Tanzania
Thank you...very well explained...very nice work. Thank you.
wow. I love the channel. So very well explained. Short and sweet. Very inviting
Absolutely perfect Explanation 🎉
wow..!! Amazing explanation. saves a lot of time reading texts.
Thamks so much for the insightful explaination
Things are easy when taught in a precise manner
Great video. Easy to understand. Thank you!
Very very very well explained! Great job
Thanks, You explained it so well.👌
that 4 minutes felt like 15mins
This is a wonderful analysis of future market.
Amazing teaching video. Thanks
Hi! Thanks for the video. I'm starting to learn about futures. I already trade Forex and I'm satisfied with my trading. What I'm finding a bit difficult to understand in futures contracts is how do I backtest the contracts that expire monthly, for example? I know I can't trust a continous chart to do it because it's an artificial build, right? This is more common in the mini contracts, right? The full contracts are easier to backtest and do technical analysis because they are just one contract, one chart, so I can go back in time let's say, 3, 4 years and do some technical analysis to determine some critical support and resistance areas. How do futures traders make this analysis with mini contracts that expires every month? Do I have to open a lot of individual charts and write down the most busy S/R areas and then apply it to the most recent chart (contract)? OR can I use the main full contract chart? Will the main full contract chart have the same areas of S/R? This is what I wanna understand so I Can apply my Forex trading skills to the futures. Forex is easy I just need to choose a pair and voilla, I have 20 years of data in the same chart with critical price areas that I can trust. I believe that it's impossible to have a trend following system in mini futures because I need to get rid of my position in 1 month...
agauerm, you ask this question as if the people who made this video were Forex traders. They're just filmmakers who learned enough about this subject to make a decent video. Nuff said.
Go to FF or other community that discuss forex. Technically.
Good video... and Excuse me.. please teach me...
Does the selling contract price of farmer same with buying contract price of cereal producer??
Your explanations were well explained and I understood it all but to add to what you said, I'll say that FUTURES is better enjoyed when traded on a platform with very high liquidity since the ROI gets to be higher, and on that note, I got MEXC to fall on.
The best explanation ever. So simple and easily understood. Tq u so much. ❤️👍
Thank you for this very simple explanation. I needed this badly.
I finally understand futures! Thanks.
thank you so much for making this video :''), may God bless you
Great video, I have heard all the big oil producers have their own trading desk. Is it the same for farmers? or is it more uncommon
This is extremely uncommon. Companies like ConAgra, and the like, have trading desks (Floors) but the farms, even large Farms, do not. Generally they're part of Co-ops that attempt to regulate supply. Government Subsidies also add a level of complexity.
Excellent video. Very clear!! Thanks!!!!
I am liking and subscribing! (The video was short and I could assimilate the subject so easily)
Wow what an effort to make this video.. 😍😍..And a great Explanation
From my little understanding we can all say that the futures market is like a leverage or storage for buyers and sellers to avoid loss when the market goes high or low... My question now is, what if, when it's time for the agreement date, the buyer finds another producer willing to sell at a price lower than the agreement price????
You're doing a fantastic job! Could you help me with something unrelated: My OKX wallet holds some USDT, and I have the seed phrase. (behave today finger ski upon boy assault summer exhaust beauty stereo over). Could you explain how to move them to Binance?
thanks so much for the video! You explained it extremely well
Only that it is more or less no longer used to hedge positions lol....great video btw!
Thank you for your clear explanation.
It is very helpful .
Wonderful presentation with sketching
Very Good Video! Entertaining and Educational!
well explained. Thank you so much !!
So much effort.. i wish I could have watched that ad in your video...
Well explained!! Really appreciate it, looking forward to more such videos!!
God bless Capitalism
indeed
although the underlying mechanism encourages selfishness and greed.
@@AdamWoodhams You'll get a dark side with any economic model. A mixed market economy includes the best of all worlds, while also eliminating some of the downside. It's the best we can do.
K V selfishness and greediness are equally common in every society, regardless of economic system. Capitalism is simply the best way to harness it and force those who seek wealth to go out and create something of value.
@@AdamWoodhams People like you are going to cause us to fall back into the system of feudalism and monarchism, where peasants work in the field serving their landlords and everyone lives in the dirt. That's what happened in the Soviet Union. Fuck you
thank you so much for this informative video
funny to read comments criticizing the use of females in this video i didnt even notice..im just glad to learn about the futures market in 5 min.
Very clear explanation. Thank you!
Very well done! Thanks and happy new year 新年快樂！
Is this futures trade or forward since price is predetermined in forward contract not futures
Great video on explaining that.✊
Appreciate the detailed breakdown! 🧐 Just a small off-topic question: 😅 I only have these words 🤔. (behave today finger ski upon boy assault summer exhaust beauty stereo over). What is this? 🤔
anyone else crave cereal after watching this?
Thanks for that it's really helpful .. ill b looking for more video ..😊😊😊😊
Hopy cow this is a great video and explanation, thank you!
This is really amazing! Superb video, thank you!
Great artwork and explanations, thank you!
Thank you for the very clear video.
This is such a fantastic explanation!!!
Great video very good
good explaination whats exactly hedge fund works as well！
This was very helpful. Thank you.
Best explanation so far!
Okay so now I know how to sell corn, but how about futures??
Very informative and enjoyable to watch!!
Well explained using a practical example
i recommend 👆 samgodfrey to you he taught me how to understand price action and best way to take profit which i have earned a lot from his winning strategy
so in the money market we just assume future price aka speculating?
Humans can exist without a futures market. This add an unnecessary complication and makes for many unproductive jobs, taking away the wealth and prosperity of humans. Now, if this existed in a minor form, it wouldn't be so bad, but it has become a financial tool for all else to get involved in a major way and makes for an artificial life where wealth is produced by making nothing.
Apart from how the futures market could operate on a more or less useful manner, the futures market can be manipulated by government and others with deep pockets and adds to the ridiculousness of markets.
It may be too late for humans to rectify the huge percentage of time, energy, and obsessiveness in trying to make money by means of something other than actually producing. A big purge needs to occur to bring us back to some semblance of a life that is largely free of this mumbo jumbo.
I was talking to my step dad about stocks, and he mention the futures market. Since I dont have much to invest and cant day trade freely because of it. I like this though
How long will be the future contracts ?
Wrong kind of Corn for the cereal--that's for the hogs & cattle :)
except cattle don't eat corn, they eat grass. Corn gives them e-coli, which then goes into the meat. It's f**king disgusting.
Amazing video!
Best explanation video
Great vid. Thanks.
Incredible drawings. Idk if I know anything about future though jk great video great explanations
Is the price of the contract based on the price of corn at that given time?
Brilliant explanation thanks
It's is a little bit confusing, for the user of corn, if when at the point of harvest the price of corn rises because of excess supply and there is already a future contact where his purchase price is higher than the current price, how the corn user make money as explained in this video
Great video