Trading Futures - Corn Futures Rollovers
I was just looking over some charts on corn. Today corn was up so I sold a couple contracts at a decent profit so I am happy about that.
It’s nice when you hit the ones that work out good for you.
I was looking at the roll overs I have to do and I have noticed something interesting.
I first looked at a spread chart with these two symbols:
c05z = corn 2005 and the z is for the month of December
c06z = corn 2006 December
In the middle of 2003 the price was inverted meaning you can buy 2006 contracts cheaper than 2005 contracts.
Then I realized that is the same thing as me looking at December 2009 contracts now.
Well I never do that, in fact I just tried to check and I can not even get quotes on December 2009 corn. I can get December 2008 but if I have nothing to compare it to then it really does not do me much good.
Anyway, even if I could get the quotes, I would never think of buying something that far out. The volume would be almost zero, I might be the only person trading it that day.
Now I am trading May 2006 contracts and looking at July 2006 or September 2006, about the only other contract I would consider is December 2006 corn because the December month always has more volume than the other months, so it is ok to trade that one farther out.
I guess I should not be so worried about volume with scale trading I can do all of my trades with limit orders so then I don’t have to worry about bad fills, so I guess the reason is more that I just never thought of trading so far into the future, and oscillation profits would be way down.
It’s nice when you hit the ones that work out good for you.
I was looking at the roll overs I have to do and I have noticed something interesting.
I first looked at a spread chart with these two symbols:
c05z = corn 2005 and the z is for the month of December
c06z = corn 2006 December
In the middle of 2003 the price was inverted meaning you can buy 2006 contracts cheaper than 2005 contracts.
Then I realized that is the same thing as me looking at December 2009 contracts now.
Well I never do that, in fact I just tried to check and I can not even get quotes on December 2009 corn. I can get December 2008 but if I have nothing to compare it to then it really does not do me much good.
Anyway, even if I could get the quotes, I would never think of buying something that far out. The volume would be almost zero, I might be the only person trading it that day.
Now I am trading May 2006 contracts and looking at July 2006 or September 2006, about the only other contract I would consider is December 2006 corn because the December month always has more volume than the other months, so it is ok to trade that one farther out.
I guess I should not be so worried about volume with scale trading I can do all of my trades with limit orders so then I don’t have to worry about bad fills, so I guess the reason is more that I just never thought of trading so far into the future, and oscillation profits would be way down.
