Welcome to NexusFi: the best trading community on the planet, with over 150,000 members Sign Up Now for Free
Genuine reviews from real traders, not fake reviews from stealth vendors
Quality education from leading professional traders
We are a friendly, helpful, and positive community
We do not tolerate rude behavior, trolling, or vendors advertising in posts
We are here to help, just let us know what you need
You'll need to register in order to view the content of the threads and start contributing to our community. It's free for basic access, or support us by becoming an Elite Member -- see if you qualify for a discount below.
-- Big Mike, Site Administrator
(If you already have an account, login at the top of the page)
I think one of the biggest risk issues is probably the fact that the leverage is actually part of the contract and it is fixed. Increasing or decreasing the amount of leverage used can be one way increase or decrease risk, but this form of risk control isn't really an option for futures traders.
So while you might think loads of different types of products (such as forex, which can have absurdly high permitted levels of leverage with some brokers) carry the risk of leverage, futures are slightly different in that you have less control over the gearing.
Of course, there are loads of other risks as well
Can you help answer these questions from other members on NexusFi?
Futures markets exist for the purpose of transfering risk from people who don't want it, to people who will carry it, obviously for a reward.
In order to succeed at this you you need to not only welcome risk but to embrace it with both arms, it is our stock in trade. Leverage is one of the few places that we (the peons) can get free money and for any amount we require for the size of our business, all we have to do is put up the deposit. If I want to expand a regular business and go to the bank to borrow the funds, and if they give it to me, it won't be for free so now in order to make a profit I must first overcome this cost and still at some point repay the loan. If you are a competent risk manager, what is there to not like about leverage, the more the merrier.
The only way to both profit and remove risk is to find a greater fool, because after all who else but a greater fool will accept the risk without the reward, and we are the last on the food chain. By not recognizing their place in the system most punters end up chasing unicorns in the form of delusional thinking, they believe that they can remove risk by predicting the future. As a young child I believed in what I saw and people told me, such as wizards and scorcerers, mind reading and people able to see the future, as an adult I understand that none of it was real, and yet many appear to have never let go of their childhood fantasies. No doubt I will get flamed for this opinion, after all many really enjoy the delusional state and how dare anyone shake their tree.lol
Your post is great! I do not think that posts like this discourage any one or prone to criticize you, rather could make one use tools that would help them to trade potentially better.
Matt
Optimus Futures
There is a risk of loss in futures trading. Past performance is not indicative of future results.
Trading futures and options involves substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results. You may lose more than your initial investment. All posts are opinions and do not claim to be facts. Please conduct your own due diligence. Use only Risk capital when trading Futures.
1 800 771 6748 local 561 367 8686 email [email protected]