Kenneth M. O’Brien
At present a futures trader can control $100 of oil futures contracts with only $6.
This is the magic of what’s called “buying on margin”.
It is the basis for a great deal of speculation in the commodities markets.
It is the Exchanges that dictate the margin requirements on commodities contracts based on their assessment of market risk.
But, there is another, more insidious, element of margin requirements.
This is the magic of what’s called “buying on margin”.
It is the basis for a great deal of speculation in the commodities markets.
It is the Exchanges that dictate the margin requirements on commodities contracts based on their assessment of market risk.
But, there is another, more insidious, element of margin requirements.
