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Buying/Trading COMEX Futures

goldielox1

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#1
Has anyone here invested in COMEX futures? Noticed that Ag was down majorly overnight so decided to bite at just under $14.20. Amazing leverage: Basically one can control 1 ozt for each $1 invested. Contract sizes are 1000 toz, 2500 toz, and 5000 toz. Haven't seen the topic discussed here but seems like a fun way to get a little more price action.
 

ZZZZZ

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#2
Futures are for speculating, not investing.

If the market moves against you, all that leverage will kick you in the butt faster than you can click "SELL!!"
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goldielox1

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#3
Futures are for speculating, not investing.

If the market moves against you, all that leverage will kick you in the butt faster than you can click :SELL!!"
.
.
I would hope that anyone on these forums would know that leverage can hurt or help more than non-leverage.

Physical is for poop hits the fan. I still have my phizz. Everything else is just making money; whether it's stocks or bonds or whatever.
 

savvydon

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#4
Beware trying to catch the falling knife.

That having been said, at this point some phased in call options for miners or metals looks like a fascinating play at the moment.
 

goldielox1

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#5
Beware trying to catch the falling knife.
Calculated outright long risk/reward:
What's the downside potential? Price of $2.50 (Interestingly it's not $0 because US Government assures that it can't drop lower due to arbitrage on buying 40% junk silver and depositing into bank for $1)
What's the upside? Price of $50+

Realistic downside: How much lower than $14.00 can it go? Maybe a $1 or $2? Miners will shut down if it drops much below current levels without substantial deflation (which we know Fed won't allow to happen).

Calls would interest me at higher levels where there's substantial downside risk. No reason for a call option when you're scraping the bottom of the barrel. It's like buying a call option on a penny stock.
 

savvydon

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#6
Calls would interest me at higher levels where there's substantial downside risk. No reason for a call option when you're scraping the bottom of the barrel. It's like buying a call option on a penny stock.
Think you may be confusing calls with puts? If you think there is substantial downside risk you would typically consider a put option.
 

Cigarlover

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#7
Downside risk I think would be a dollar since the silver eagle has a 1 dollar face value. I'd be very surprised if we ever got down to single digits again. I've actually never bought any in single digit territory so that would be interesting.. That being said if we see single digits I am guessing that 8 would be some serious support.

Look forward to hearing how others trade these as well. Should make for an interesting thread.
 

goldielox1

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#8
I guess no one has tried this. I hear about people buying mining stocks to get more leverage but seems simpler to just get a future contract.
 

goldielox1

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#9
Closed position on Friday with the spike to 14.74.

50% return in less than 4 weeks. Not too shabby.

btw, I think that the spike was due to short covering since Au moved only 1% while Ag was up 3%. I expect Au to fall back this coming week at which point I may jump back in. GSR went from 83 to 81 in one day.
 

oldgaranddad

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#10
Go to Vegas, you'll have better odds. The one win you had was to suck you in deeper for the kill.
 

newmisty

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#11
I think comics are outdated now, along with baseball cards. Bad investment idea.
 

oldgaranddad

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#12
I think comics are outdated now, along with baseball cards. Bad investment idea.
Even collectable coins too to an extent. The manipulation of the market is remarkable. Just look at the 1996 National Community Service dollar in MS-69. Raw it used to go for $145 and slabbed it went for easily $230 for MS-69 now a PCGS MS-69 can be had on ebay for $99. Tell me someone isn't playing with the market.
 

Fatrat

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#13
Closed position on Friday with the spike to 14.74.

50% return in less than 4 weeks. Not too shabby.

btw, I think that the spike was due to short covering since Au moved only 1% while Ag was up 3%. I expect Au to fall back this coming week at which point I may jump back in. GSR went from 83 to 81 in one day.
Sounds like fun, glad you won the bet.
 

goldielox1

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#14
Sounds like fun, glad you won the bet.
Thanks. Nice plunge today has me itching to get back in if it gets into the teens. Rinse and repeat.