Cheapest way to bet on crude oil spot prices?

Discussion in 'Trading' started by tonyf, Mar 27, 2020.

  1. ph1l

    ph1l

    #21     Apr 4, 2020
  2. tonyf

    tonyf

    You would need to look very carefully at what @FoggerMan said. It will take you time to understand it all but it is a very important concept. Same applies to VIX ETFs and other commodities.....
     
    #22     Apr 5, 2020
  3. tonyf

    tonyf

    Thank you, once again for alerting me about those pitfalls....
     
    #23     Apr 22, 2020
  4. ironchef

    ironchef

    Question:

    So, if I want to buy one contract of May 20 WTI future, it will cost me $22,600 + commission? Is it for WTI, Blend WTI...?

    According to YChart, WTI on 4-20-20 was $36.98?
     
    #24     Apr 22, 2020
  5. The May contract has expired. The front month contract is June, which is trading at ~$14 x 1,000 = ~$14,000 notional value. The current margin requirement by the CME is $6,400, meaning you would need to only put out $6,400. If the position goes against you you would need to deposit more funds. Unlike a stock, since the price can go negative, there is no limit on how much you may need to deposit so keep that in mind.

    Here is the CME's page for WTI: https://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html

    They also have a mini contract that is half the size: https://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html

    It sounds like you may not have much experience with futures though so I would definitely do some research before trading them (as you are doing now with this question).
     
    #25     Apr 22, 2020
  6. tonyf

    tonyf

    Out of curiosity, are you trading oil futures and if so, how is the currebt volatility affecting you?
     
    #26     Apr 22, 2020
  7. I don't trade oil or any energy products. There's no particular reason for that other than it's just not what I specialize in.
     
    #27     Apr 22, 2020