Three Factors that Affect Futures Trading

When prices fluctuate, it affects every area of the economy, and it is a desire to be shielded from any negative fallout that often drives investors to add futures trading to their portfolios. The perfect tool to reduce volatility for both businesses and individuals alike, such contracts can serve an invaluable purpose when it comes to safeguarding your market successes.

However, futures trading should be approached in the same way as any other type of trading, and many investors fail to appreciate this. In order to properly understand what drives these investment instruments, and thus be able to use them to your best advantage, you therefore need a grasp of the various factors that affect them.

To help you out, here are three that you need to know…

#1: General Factors 

Like any sort of investment, general economic conditions will affect the value of assets. Where a nation is experiencing a financial boom, for example, price rises are likely; where it is not, decreases are more probable.

The wider factors that impact these must also be taken into account, and this means that political uncertainty, social instability, and commercial or industrial prospects should all be evaluated when choosing your futures investments.

#2: Commodity Factors

 One of the largest and most popular segments of the futures markets is commodities, and this means that any factors affecting this area will also need to be considered. Thus, events or happenings which influence the supply or cost of production of a particular commodity will have the ability to impact its value on the futures markets.

In the case of agricultural futures, for example, this will mean looking at any recent unfavourable weather patterns, such as droughts in particular countries or floods in certain regions.

In addition, export and import policies or restrictions might also affect prices, so the impact of events such as Brexit should be thoroughly assessed.

#3: Currency Factors

 Currency futures are as volatile as the currency markets they’re based on, as experts like FxPro can attest. Influenced by a huge range of factors, from central bank decisions to government policies regarding taxation, conflict, and even political upheaval, trading these contracts requires an in-depth understanding of the foreign exchange and all of its intricacies.

The factors discussed above offer only an initial insight into all of those that you will need to understand, and this means that futures trading is not something that should be entered into lightly. However, provided that you’re willing to put the effort into developing the skills and knowledge necessary to succeed in such a specialist area, the opportunities are there for those talented enough to take them.

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Understand the Basics of Spread Betting

Spread betting was started in UK in the year 1970 to speculate changing price of gold. Later it gained popularity and was used in financial companies. Today, in stock market people have started trading cautiously to earn for long term. However, one needs to have in-depth knowledge and trading mind to trade and gain profit. Spread betting is now the best ways considered to trade and the safest ways to consider. Financial betting is the safest way to earn the benefit of a changing market scenario. However, it is important to be backed by a reputable spread betting company like ETX Capital.

If you’re a beginner and have no knowledge about the betting, then it is important to have some knowledge about it and betting safely:

Choose your Bet: This is the foremost thing to consider while learning the betting process. If you manage to find the effective strategy that gives you better return, then you can make significant amount through it. There are certain factors to consider which include- History of the company, internal events and external events. It is essential to check the position of the company in the market.

Know the Timing to Bet: Betting at the right time and on the right product of the company is important. If you’ve spotted an asset which can make a significant move, you can place the bet when the price is low or high. The trick is to bet and earn maximum profits, without waiting for too long.

Know when to close the Bet: Once you’ve done the betting, it is important to know when to close the betting. Many people have witnessed a negative result while they keep going with the betting and having no idea when to close. These people end up waiting too long to close the bet, which results into losing of money or missing out the gain.

People who spread bet often lose money that can bring down their confidence. So following certain tips on losing money can be beneficial:

Good Betting Practice: If you want to have a good practice and learning process about the spread betting, then you can go for online dummy betting service. There is no real money involved, so one can use most of the opportunities before going ahead with the real money.

Right Betting Broker: If you’re using online broker service that carries good reputation in the market, then it is the best way to bet. These online brokers provide regular updates and betting assistance helping you to earn.

It is generally advised the spread bet of small amounts and regular stock brokerage account for holding and buying shares. The main advantage of financial spread betting is tax free earning. Start with small steps, and move up over the time as you keep learning.

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Is Forex Trading Safe?

Due to the rather poor performance of many open markets this year, countless investors have been turning their attention to the exciting world of the Forex industry. Considering that a massive $5.3 trillion dollars is said to change hands every day, this should come as no surprise. Words such as profit, liquidity, movement and fluctuation are often associated with currency pairs and such concepts have left many wondering if Forex trading is considered to be a safe form of investment. To answer this question, it is wise to examine a few concepts in more detail.

Appreciating Liquidity

The Forex markets are currently the most liquid investment field in the world. Liquidity naturally equates to higher potential profits within a short period of time. However, it is also wise to appreciate that such movements can likewise lead to substantial losses if the correct strategies (and electronic platforms) are not chosen. Prudence is therefore a key strategic concern before investing and the mechanics should be studied carefully. This can be likened to sailing across an ocean. Navigation and understanding nautical principles are critical to avoid capsizing.

Risk Versus Reward

The majority of traders who eventually lose money do so as a result of greed superseding pragmatism. In other words, quick profits can cause a blind eye to be turned to what may be just around the corner. Trading and gambling are two entirely different concepts and the two cannot exist together. The most successful Forex investors will therefore leave their emotions at the door. Once a certain profit margin is reached, they will simply walk away and trade another day. The same strategy holds true in terms of a loss. It can even be said that successful trading is just as much of a discipline as it is a science and an art form.

The Platforms Employed

Perhaps the most critical aspect of Forex investing revolves around choosing the most applicable trading platform. There is no room for second-best brokers for those who wish to enjoy sustainable wealth over time. Some of the key aspects of any system should always include:

  • Access to real-time data and news feeds.
  • Intuitive trading platforms.
  • Numerous trading tools and instruments.
  • An ability to invest in a number of categories and underlying currency pairs.
  • The utilisation of dedicated smartphone applications.


These are only a handful of the available tools. Such vehicles are essential to stay on top of the latest news and immediately execute a position. Traders who do not have access to these vital amenities will almost certainly miss lucrative opportunities and in a worst-case scenario, they could lose a significant amount of money.

Forex trading is ultimately as safe as the strategies which are employed (much like any other market investment). Through the bespoke platforms offered at CMC Markets, any trader can be certain that they are aligning themselves towards a rewarding and lucrative financial future.

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What Might We Do With Our Extra Money?

Looking at our money and our budget, there are a few things that have changed over the recent months, and it will require some change in planning on how we approach our money.  One of the things we’ll have to look at it how we allocate ‘extra’ money.

Where Is This Money Coming From?

Everybody will define this differently, but for us the extra money boils down to a few different areas.

  • Credit card rewards – Most of our spending is done on cash back rewards.  As such, we’ll have a few mb-201312billscoinshundred dollars in rewards after cashing in all of our rewards.
  • Tax refund – Last year we had to pay on our 2014 taxes.  This was largely because of a few things: I switched employers and our witholding didn’t cover us as well as I’d anticipated due to some changes in insurance coverages and such. We also realized some stock gains, and also cashed in some savings bonds that had fully matured.  In 2015, we should get a refund, as our withholding was adjusted, we didn’t do so great in the markets, and didn’t cash in any rewards. Our taxes are still out to our CPA, but a back-of-the-envelope estimate shows that we should get a couple of thousand dollars.
  • My wife’s side hustle – My wife runs a really cool shop on Etsy where she designs custom invites, thank yous, wall arts, and similar products.  Up until recently, pretty much everything went to funding our recent Disney World trip.
  • Pet expenses – Our cat recently passed.  We are going to give ourselves some time before even considering whether to get another pet, but expenses will definitely be reduced, as his food, medicine, vet, and boarding costs definitely were not cheap.

So, these are the four areas that we see working in our favor in terms of cash flow.  Some are one-time things and others will be more ongoing.

So, what to do? What to do?

A Couple of Needs, Some Wants, and Looking Toward The Future

Honestly, there are a few things that we will probably do with the money.  Not all of it is flashy, but it’s all (OK, mostly) helping us strive toward goals like saving for retirement, saving for big purchases, and being able to do enjoyable things without taking on debt.

Here are a few ideas.  The splurge type stuff first:

  • New wireless router – Typically our credit card rewards money has funded our purchase of new electronics .  All flat screen TVs and my wife’s laptop have been funded by money our credit cards have given us.  As we now have replaced them all and don’t have any real electronics needs, the entire amount won’t go there this time, but we do want to buy a new wireless router.  The one we have now is at least 7 years old, doesn’t provide the latest security, and the coverage kind of stinks compared to what’s available today.
  • Vacations – Even though we aren’t piling as much into our travel fund as we did to fund our Disney trip, we’d still like to take a family trip every couple of years.  We liked Florida and have never taken our kids to the beach, and so we’re considering saving a smaller portion of my wife’s business toward a trip to the Tampa / St. John’s Pass area.
  • Other travel – Most of our other traveling is done with our RV trailer, but we do like to do a trip to a water park during the winter months, and every couple of years, my wife and I like to consider a small anniversary trip in the fall.  These aren’t extravagent or largely expensive, but stashing a few hundred bucks goes a long way to making sure we can jump on a deal should one arise.
  • Entertainment – We both used to be pretty frequent concert-goers but kind of stopped once we had the family.  We have done a few concerts and really enjoyed it, so we’ve decided to try to do 1-2 concerts per year.  Putting some money toward a specialized entertainment fund is a good goal that will let us buy tickets and a night out without guilt.
  • Furnace Fund – Last year we found that our furnace is starting to fail. We’ve taken some measures to slow this and are very carefully monitoring the device, but it will have to be replaced at some point in the next several years.  Continuing to save for this or other big purchases that might come up is important to us.
  • Retirement – Being able to add a percent or two to our 401(k) contribution or a chunk toward our Roth IRA is never a bad idea.
  • Kids Activities – We set aside money for some of the big things that our kids like to do.  Summer camps, swim lessons, dance lessons, etc.
  • Replacement Car / RV – We are proud that our two cars and our RV are from model years 2006, 2007, and 2004 respectively. However, the bottom line is that eventually they may hit the end of their useful life.  We save for this and could likely replace one without having to take on a loan, but with all three at that age, it could be that more than one would need to be looked at in a shorter period of time.  We will definitely be upping the allocation here, as we want to be prepared.

So, that’s really about it.

Readers, I’m curious what you think of our plans or if you have any other ideas or feedback?  Have you had any favorable (or unfavorable) budget changes over the past months, and how have you worked to incorporate them into your spending plans?

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