This is the most profitable way to trade if you already have a job and little time
Imagine having the convenience of checking the monitor with the charts only in the evening, after the close of the markets. Do a short 15-minute analysis and then decide whether to enter the market.
Every month you make a maximum of two operations and at the end of the year with a little experience, you can also earn percentages of 50% on your capital.
This is the type of trading I want to tell you about today. I appeal to those who want to create an additional income for themselves. In addition to the one, you already have with a job or a business.
Even if you don’t have a lot of time to spend learning and monitoring the markets, there is a way to trade that can still be profitable.
It can also be profitable for your mother or child, a housewife or worker who are strangers to this world. With a little information, everyone can do this.
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This is the most profitable way to trade if you already have a job and little time
This system is known as long-term trading. I am specifically talking about long-term trading applied to commodities. Done in a very particular way. Known by industry experts but not by everyone.
Obviously, you need to take a little course to understand the basics, right, and slowly become familiar with what you do. But all of this is achievable while you work and manage the family.
WHAT IS COMMODITY TRADING?
Long-term trading means that you could trade today expecting the market to go up in six months.
In reality, with commodities, operations open and close much earlier, from a few days to one or two weeks in total duration.
You can do all of this without worrying about short-term fluctuations, you can take your time researching what to do. This relaxed approach also allows you to have other commitments outside of trading.
What are commodities in the world of finance? They are the natural resources essential for the production of goods and services.
“They include goods like oil, gas, gold, silver, wheat, coffee and corn. There is meat, metals and construction timber ”.
All of these commodities that exist in the real world also have an equivalent financial asset that you can buy and sell. Without corn, meat, or oil arriving at home. I’m kidding, of course, I guess you get it.
Long-term trading is a strategy in which you take a position in a market by buying a financial instrument that reflects the price of that commodity (Futures) with the aim of holding it for a long period of time, which is no less than a day.
It is a cross between an investment (for example that of a savings portfolio in stocks or bonds) and intraday trading. Very different from scalping, where positions are only held for a matter of minutes or hours.
However, to trade commodities in a very profitable way you will have to put in place a particular system.
This is the …
SPREAD TRADING
Spread trading is a type of trading that involves taking a position on the future price differential of two similar commodities.
It is also called pair trading:
“It is a strategy adopted by traders who want to exploit a temporary market asymmetry or counterbalance their exposure on the markets”
I’ll give you an example. However, I will not use it on financial instruments but on the foods that you buy at the supermarket. Let’s pretend we’re trading these products.
Let’s say you go to the wholesale market:
Potatoes usually cost $1 a kilogram.
Let’s say tomatoes usually cost $1 a kilogram too.
These are obviously fancy prices.
But that morning the potatoes cost $0.80 per kilogram. While tomatoes still cost $1 per kilogram.
It means that there has been no price inflation, but simply the potatoes are cheaper (for some reason we don’t care). While their point of reference (the tomatoes) always cost the same price.
How does spread trading work at this point?
Yes, they buy potatoes, for example, 100 kilograms, for a cost of 80 euros. And tomatoes are sold, for example, 100 kilograms at the price of 100 euros.
Obviously, you will know that in trading as well as buying a financial instrument, you can also bet on the downside by selling it and earning anyway.
What happens at this point?
At some point, the potatoes will cost 1 dollar again. When this is the case you will sell everything and you will have a profit of 20 euros. Because you bought them for $0.80 and you’re going to sell the 100 kilograms for $100.
If, on the other hand, it happens that the tomatoes decrease in price, for example at 0.80 dollars maximum, you will sell everything without losing money.
If you are an expert you will know that this is a very simple example.
I have to tell you something important. Usually, two financial instruments are chosen that are specular: that is, we know that they are at the same or identical price distance and when one grows the other rises and vice versa.
So, having said this last specification you will better understand the example I gave you above.
WHAT PERCENTAGES OF EARNINGS CAN BE MADE WITH COMMODITIES?
The percentage of profit that can be obtained from trading on commodities varies according to the type of financial instrument used and market conditions.
It is usually much higher than the average return on investments in stocks or bonds.
Surely if you learn well, taking one of the courses that are sold by industry experts, you will easily be able to make a double-digit percentage.
“I mean at least 10% or 20%. The really good ones exceed 50% a year, mind you”
WHY RAW MATERIALS ARE TRADED?
Commodities can also be used as a hedging tool to protect against price fluctuations in other investments. In reality, this financial instrument was created precisely for this purpose.
For example, let’s take Mcdonalds. In one year he uses incredible quantities of meat and will certainly use hedging on commodity financial instruments.
What does it mean?
It means that Mcdonalds has fixed prices for their sandwiches. But if the price of meat goes up too much, or the price of corn to make sandwiches, it could make less money.
So he hedges — so they say — by buying corn or meat Futures contracts, so if the price goes up and he will pay more for the raw material, he will still have a profit with financial instruments. Offsetting the difference in the price paid for the physical meat for the sandwiches.
Then commodity futures also became a tool for earning and speculating. Both for companies themselves and for individuals.
Now it’s your turn … take advantage of this opportunity.