Message:

<p>[QUOTE=&quot;medoraman, post: 1474166, member: 26302&quot;]The intention of the market is to financially hedge your risk, not physically. If you need silver, and today&#039;s price looks appealing, you would buy today for &quot;delivery&quot; in the future. Let&#039;s say today is $27 at the CME and you can buy locally for $27.50. So if you buy on the CME, you are really locking up $27.50 cost of silver. When the contract comes due and you were right and it has moved up to $32 on the CME, you sell the CME contract and make $5 per ounce. You buy locally for $32.50, subtract the $5 profit from the CME, and yoru cost per ounce is the same $27.50 you wished to lock in. </p><p><br /></p><p>Commodities for the most part are too expensive to ship numerous times, this is why commodity futures markets are really financial hedging and price finding operations, not really intended for physical delivery. If all of these commodities had to PHYSICALLY go to chicago, be stored, then delivered out of chicago, it would be a bloody nightmare, (as well as logistically impossible for some commodities).</p><p><br /></p><p>Big firms selling are offset by big buyers buying, with speculators in the middle. If someone really believes the big firms are overselling, put your money where your mouth is and buy.[/QUOTE]</p><p><br /></p>

Your name or email address:

Do you already have an account?

• No, create an account now.
• Yes, my password is:
• Forgot your password?

Stay logged in