What are Gold Futures?
Gold futures are also known as "gold futures contracts." Futures contract with gold as the trading object. Like general futures contracts, gold futures contracts also contain trading units, quality levels, deadlines, last expiration dates, quotation methods, delivery methods, minimum price changes, and limits on daily price changes. Gold futures contracts are generally divided into two specifications according to the unit of measurement. Take the Chicago Grain Exchange as an example. One is a gold futures weighing 1000 grams and 99.5% purity, and the other is 100 troy ounces. Gold futures with a purity of 99.5%. [1]
Gold futures
- (I) Dispute over the theoretical basis of traditional technical analysis
- Gold futures are also known as "gold futures contracts." Futures contract with gold as the trading object. Like general futures contracts, gold futures contracts also contain trading units, quality levels, deadlines, last expiration dates, quotation methods, delivery methods, minimum price changes, and limits on daily price changes. Gold futures contracts are generally divided into two specifications according to the unit of measurement. Take the Chicago Grain Exchange as an example. One is a gold futures weighing 1000 grams and 99.5% purity, and the other is 100 troy ounces. Gold futures with a purity of 99.5%. [1]
- Gold futures are
- Gold currency symbol
- Currency symbols, we must first understand which currency pairs are fired. Currency pairs are in English and cannot understand what to do. Below are some currency symbols. Frying gold is the most basic thing is to know the gold symbol and his exchange rate. Earn profits based on an increase or decrease in the exchange rate ratio.
- After learning the basics, let's learn what constitutes the gold market.
- On December 6, 2012, domestic gold futures plummeted after listing, and fell across the board on the day of listing;
- Operating characteristics: Gold futures in June and December have become the main contract in succession (as shown in the figure, silver futures have similar characteristics).
- The Shanghai Futures Exchange, after the listing of gold futures varieties, gradually formed a special situation in which the June and December gold futures contracts alternated as the main contract. As of December 16, 2013, the first two main contracts were 170,670 positions held by gold 1,406 Gold 1312 contract positions were 2118 lots.
- Trend line 123 / 2B
- consolidation pattern: it is in a narrow range of consolidation.
- When finishing the narrow range, draw a horizontal straight line with the highest point and the lowest point of the interval, the upper edge is the resistance of the interval, and the lower edge is the support of the interval.
- Breakthrough with a large volume
- 1. As early as 5-14 o'clock
- Advantages of gold futures:
- 1. Two-way trading can buy up or down.
- 2. Implement the T + 0 system, which can be bought and sold at any time during the trading hours.
- 3, with small and large, only a small amount of money can buy and sell the full amount of gold.
- 4, the price is open and fair, 24 hours and international linkage, it is not easy to be manipulated.
- 5. The market is centralized and fair. The prices of futures trading in one region, country, and the world's major financial trading centers and regions are basically the same under open conditions.
- 6. The role of hedging, that is, the use of buying and selling futures contracts of the same quantity and price to offset losses caused by fluctuations in gold prices, also known as "hedging."
- 1. Gold futures contracts have different trading margin collection standards at different stages of the listing operation. At the time of entering the market, the level of the margin ratio is determined. If investors do not pay attention to the additional margin during operation, it is easy to be closed.
- 2. If you do not choose to close the position before maturity, you must deliver physical gold at maturity, which is not what the average investor is willing to choose.
- 3 It is a mandatory requirement that natural persons cannot carry out physical delivery of gold. If the position of a natural person customer is not 0 in the delivery month, the exchange will perform a forced liquidation from the first trading day of the delivery month. Profits resulting from forced liquidation are handled in accordance with relevant state regulations, and losses arising from forced liquidation are borne by the person responsible.
- Like many physical transactions, gold investment can be invested in futures and spot transactions. Next, let's compare the advantages and disadvantages of futures gold and spot gold.
- Trading mechanism
- Futures gold: There is a shorting mechanism, which can be profitable in two-way trading, and there are profit opportunities in fluctuations. T + 0 trading system. The position can be opened and closed multiple times on the same day, but there are delivery days, which must be delivered at maturity, otherwise they will be forcibly closed or delivered in kind. At the same time, positions will be forcibly closed when the margin is insufficient.
- Spot gold: There is a shorting mechanism, which can be profitable in two-way trading, and there are profit opportunities in the market. T + 0 trading system. The position can be opened and closed multiple times on the same day. There is no delivery restriction and unlimited holdings can be made. However, positions will be forcibly closed when the margin is insufficient.
- Transaction funds
- Futures gold: margin trading. With 10% of the funds, 100% of the transactions can be done, and the funds are magnified 10 times.
- Spot gold: margin trading. According to the different magnifications of various gold companies, there are differences, but most of them can be operated with 1% of funds to 100% of gold. The magnification of 100 times is calculated by hand. Some platforms can do 0.1 lot etc. But spot gold is not formal enough globally.
- transaction hour
- Futures gold: trading hours are 9: 00-11: 30, 1: 30-3: 00. Due to the short trading time and the inconsistent international gold price, gaps are frequent. Investors cannot enter in the early stages of the market.
- Spot gold: Due to the time difference, the domestic market can be traded from 8am on Monday to 3am on Saturday. That is all-day trading, which can be entered at any time in the market. It is superior to futures in terms of price continuity. The most active trading period is between 8.00 and 24.00.
- Gain limit
- Futures gold: Depending on the type of futures, the daily limit will vary from 3% to 15%.
- Spot gold: no increase limit.
- Account opening threshold
- Futures gold: start no less than 30,000.
- Spot gold: The standard platform to open a standard warehouse is 5,000 US dollars, which is more than 3W RMB, and some platforms can open mini warehouses, which are generally around 1,000 US dollars.
- Most of the gold futures markets in the world have similar trading contents, including margin, contract units, delivery months, minimum fluctuation limits, futures delivery, commissions, daily trading volume, and commission instructions.
- Although gold futures also use a margin system and a two-way trading mechanism, there are still significant differences between gold futures and other futures types in trading. Therefore, investors also have tips when setting up a stop loss scheme in gold futures trading.
- First, because
- The following table is the New York Mercantile Exchange on April 8, 1993
- Technical analysis is an investment method based on the disk phenomenon and using technical charts as a means to capture price trends. Compared with fundamental analysis, technical analysis is a way to study price changes from phenomena. Just like experienced sailors judge where there are reefs and where it is safe to sail based on changes in water flow: like people can see Clouds change to determine if it will rain. The phenomenon analyzed on the technical side is the disk information centered on price changes.
- Technical analysis has been criticized since its inception. The main objection is to doubt the theoretical basis of technical analysis. The theoretical basis proposed by authoritative technical analysis theories is basically derived from the three major "Dow theory" Suppose, later in John Murphy's authoritative work on technical analysis,
- The trend of gold and the stock market is generally reversed. Gold is a safe-haven product. The stock market has plummeted and more funds have flowed to gold. This is one of the factors that keeps the price of gold rising.
- Novices should consider three aspects when formulating a gold futures trading plan: fundamental analysis, technical analysis and fund management. It is more important for a novice to learn to survive than to make money, and the key to survival is to master effective fund management methods and set a stop loss program.
- First of all, do not operate the full position, it is best that the funds occupied by overnight positions of a single product are within 1/3 of the total funds.
- Secondly, stop loss must be strictly enforced. The daily fluctuation of gold price is less than 2%. According to the historical fluctuation characteristics of gold price, investors can set the stop loss level near the upper limit of the daily fluctuation range. For short-term investors, if the daily volatility exceeds 5%, they should profit from their positions. For medium- and long-term investors, first of all, they must judge the market trend, and then design the investment ratio based on the amount of their own funds. Initially, investors in the market can invest about 30% of the funds into the market and set the profit-loss ratio to 3: 1. Stop loss when the loss reaches 30% of the expected profit.
- In a trading plan, taking a transaction as an example, it is necessary to first determine which fundamental factors dominate the market, and then analyze the market's expectations of it and how the expectations are reflected in the price. On the technical side, we need to set what price to enter, what price to profit, what price to stop, how many positions, whether it is intraday trading or trend trading, how to deal with sudden changes in the market, and so on.
- It is very important to develop a trading plan, and it must be strictly implemented during the trading process.
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- From the global gold supply and demand data, it is expected that gold supply will exceed demand this year, as shown in Figure 6. The gap between gold supply and demand in the first quarter was small, while gold supply in the second and third quarters exceeded gold demand by a large margin.
- The relevant person in charge of the China Securities Regulatory Commission stated on April 12 that in order to promote the internationalization of the domestic commodity market and facilitate investors' risk management, the Securities and Futures Commission plans to select gold and silver futures for continuous trading pilots. In the previous issue, every Monday to Friday from 9 pm to 2:30 am the next day will be used as continuous trading hours.
The above-mentioned continuous trading time is basically the same as the Shanghai Gold Exchange's night time, and also coincides with the active period of the Chicago Mercantile Exchange's largest trading volume of the gold electronic disk.
In the last issue, the relevant rules for continuous transactions have been basically formulated, and market opinions have been solicited. On the basis of soliciting opinions, the last issue will be officially released. For the nightly fund transfer, trading system transformation, emergency protection and other tasks involved in continuous exchanges, the previous issue is also coordinating the relevant parties to actively prepare.
- The Shanghai Futures Exchange officially announced that it will officially start night trading of gold and silver futures on July 5, 2013.