Cotton Futures, in detail

Cotton Futures, in detail

The law on futures on cotton, 1916: In the beginning of the 20th century in the United States began active development of the futures market, at that time there were only commodity futures and one of the markets, which demanded standardization was cotton market. Futures does not appear from the sky, to do this go, so since 1914 the discussion has been passed the law on cotton, which gave the right to the Agricultural Department of the United States (US Department of Agriculture) to set quality standards for the sold on the stock exchange of cotton - if, before this there were requirements on the supply and the terms of the contract, now entered parameters quality: color, length and size of the buds and other physical parameters. Although these proposals in the law are not limited to, the cotton traders, were obliged to inform the Agricultural Department of the United States where, for how much and why they bought cotton. The goal is simple - to reduce the level of speculation cotton.
Two years later, in 1916, the law on the cotton was approved by the government of the United States.
The development of trades cotton and Cotton Futures
Not a lot of history will never stop, otherwise don't understand how and what where it came from. Now let's turn to numbers and ñîôòàì as a whole. Perhaps the exchange of software can be called the InterContinental Exchange (ICE), are traded at this exchange of grains and softs.
For example, today in the sugar market is trading 760 thousand contracts, coffee 185 thousand, cocoa 195, and on cotton 302 thousand futures. It is difficult to understand a lot of it or not, so count on the example of the cotton market «Cotton No.2 Futures»: the value of the cotton 152.67 (July contract on 27.05.2011) dollars per pound, in the contract of 50 thousand pounds. Total obtain - in the cotton market hangs 2.3 trillion us dollars. Not every financial and foreign exchange market can boast of such money. And this despite the fact that at all ñîôòàõ now there is a decline in open interest, for example in the end of 2010, the open interest in the cotton market exceeded 450 thousand contracts.
If the market always was flat and it was not possible to earn, it is not hung without cause that kind of money.

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