newbie question what is the worst things that can happend when you buy or short an oil contract? i am familar with index futures, can somone explain how oil futures refrencing index futures from speculator's point of view can you short oil contracts? say it drops to 20 or 30, you hope to cash in on the long term, you buy a monthly contract and roll over every month hoping for high oil prices in the future, is that safe?
The worst thing that can happen?? You get a load of oil turning up at your house because you miss the expiry!!! or the flip side, you have to pay through the nose for some physical, because you don't actually own any oil that you need to deliver!! With the greatest respect, please don't trade oil if you need to ask these questions. I appreciate everyone has to start somewhere, but I just don't understand why people want to trade one of the hardest things going when they're a newbie? Try trading something a little easier to start with! Happy trading!
I trade index futures but thanks for not answering my question. Did I say I actually traded oil? I was just asking the question, my intrest is oil related stocks. The last thing I like is arguing with people in forums who can't seem to shut up. of course anyone would liquidate a contract beforethe delivery date, I was asking more in the terms of it moving aganist you.
Ok. Apologies. I took "Oil contract" and a subject matter of "oil futures nymex" to mean crude futures. Silly assumption on my part obviously. Cn't help you with oil stocks I'm afraid. Right, lets get on, be constructive, and try and discuss your question rather than argue. That said, I still don't understand what you're trying to get from the question. If it moves against you, you lose money!!?! I'm not trying to be annoying. I just generally can't think of an answer. The worst thing that can happen is you don't have a stop, keep hanging on to a loser and eventually your FCM liquidates your position and your account is blown out. I could be completely missing the point here!?