Hypothetical question. If I buy 1 SSF contract on april. Howlong can I hold it for? Guess what I am really asking is; does my contract ever get expired, and then I am force to close my postion? Thanks
Please someone must know the answer to this! =) I like to trade SSF , but would like to know if I can Holdon to the contract, for a long period of time, say 6 months or more. Would I be allow to, or does my contract expires after a few months?
If someone were to tell me I have a rudimentary understanding of futures/options/etc., I would take it as a compliment. However, I am sure to have posted questions as obvious as this before, so here you are: Yes. The contract expires, that's why there is a contract date. I am sure that whatever broker you use to trade, or would use to trade SSF's (Interactive Brokers, for example) will provide you with all you need to know regarding the opening and closing of SSF positions.
Futures expire, that's why they are futures. You should consult www.onechicago.com and other internet resources to read more about SSFs. The April contract expires this Thursday, as Friday will be Good Friday, so you might as well trade the stock outright. If you want to hold on for longer than 6 months, you may want to look at Sep or Dec expiration. Before you do anything, have more than just an idea about what you are doing.
So are you guys saying that it is no good to try and trade SSF for Long term? Whats the maximum amount of time i can hold one contract for?
On 4/17 a short can deliver the 100 shares of stock to you. Be careful you may wind up with 5000 bushels of soybeans on your front yard.
You might want to start trading options first. Then you'll have some experience with that type of instrument. If you can understand options, you'll have no trouble with ssf's. Also, there is a lot more info out there on options.
Toronto, Futures are not usually associated with long term investments. Futures and by that I also mean Single Stock Future are usually a speculative/hedging tool for the near future (Although some futures have expirations that reach out way into the future, say 2006). Therefore they come with an expiration, because someone is expecting you to buy or sell that underlying asset at the expiration date. If you want to buy and hold them you will have to rollover the contract whenever it expires. Good luck
So If I wanted to hold for 6 months I would buy the december contract? Though will I even get a fill?
The further out you go, usually the wider the spread (greater risk). If you want to hold on to the contract for 6 months, then a Sept or Dec future would make sense. Will you get a fill? Initiate a quote request and if you hit the bid/ask you'll get a fill. The alternative is to roll over one month to the next or buy the physical stock. The advantage with the SSF is that you'll have to put up less cash (ofcourse more leverage can be harmful as well) Note: SSF's in the US are physically settled. So if you hold through expiration, you will either own or be short the shares. One other option - no pun intented - is to purchase an option. If you are buying or selling a stock with a given price target six months away, buying a call or put could make sense.