Short description
Transact steel futures in the market.
Capacity
- You act in the role of a market participant.
- You act in the capacity of aggressor.
Task
Your task could be manifold. Choose any of the following possibilities:
- Setup a consumer hedge; purchase a 3-months ahead steel futures contract.
- Setup a producer hedge; sell short a 6-months ahead steel futures contract.
- Perform speculation; buy and sell as much as you’d like to make your working capital grow.
- Analyse the price charts and make a comparison. Click on the contract name to select the futures contract of preference.
- Analyse the forward curve.
- Setup a time spread position (e.g. buy a 2-month ahead contract while, simultaneously, selling a 8-months ahead contract).
Situation
- Exchange-trading of (10) listed futures contracts, with different times-to-maturity.
- Check your working capital (and other financials) at the start, as well as during the simulation.
- Position limit per contract: 5 (long or short).
- The order book provides market depth (3 additional rows on top of best bid/ask). Click on the plus-sign to unfold additional rows. This way, you will also see orders with the next best prices.
Objective
The aim of this simulation is to apply what you already know have learnt so far and to master more knowledge. This includes screen-based trading, exchange trading, market dynamics, price volatility, the working of the order book, price charts and forward curves.
Conclusion
At the end of the simulation, analyse your performance. See what you have done and when you have done this and whether it could have been optimised. This way, you learn and optimise your competences.
Financials
- Initial working capital is 800.00.
- Exchange fee (per contract) = 0.02; clearing fee (per contract) = 0.02.
- Initial margin is 40.00 per contract.
Note
- Feel free to pause the simulation when it is running. This allows you to temporarily stop the dynamics, which allows you to analyse while the market is frozen.
Study advice
Follow these online courses (see: guide) at Entrima, to apply relevant knowledge in this simulation:
- Commodity trading – Reasons to transact
- Risk – Risk & opportunity