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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Kailash who wrote (46698)	12/5/2005 5:31:49 PM
From: silvertoad	Read Replies (1) \| Respond to of 110194

kailash, my remark about poor liquidity was directed towards the mini-contracts, not the regular 5K bushel grain futures contracts. yes, one could "invest" in grains for a time, i suppose, by mechanically owning and rolling over contracts as they expire, but the leverage in futures is so great - margin < 5% - that severe drawdowns would have to be endured. but it's certainly a possible strategy if one is very careful not to have too large a position in relation to equity - but few would recommend it - using stops is the standard technique. most lose in commodities not becuz they're any harder to trade than stocks, but due to the great leverage...so trading with less leverage so that one can withstand some adverse moves isn't a bad idea at all. i think grains might have a nice rally too from rather low current levels. -jb edit - check out lind-waldock or other futures brokers sites; i'm sure there's lots of helpful info available online.