Futures- Is Now the Right Time for You to Invest?

Crude oil and even futures in general have always been one of the most interesting things you can invest in. It comes with its fair share of benefits and you may even find that there is so much to learn about the trade as well. The main problem that a lot of people have however, is that they don’t know if they should invest in it over the stock market.

Substantial Profit

Both the stock market and crude oil have the ability to give you a substantial amount of profit. Both of them give you the chance to make a very lucrative investment. You could make thousands with one trade and nothing can quite compare to this. One thing you should know about futures is that the price can change a lot in a very short space of time. This can be good and it can be bad at the same time, so if you do not have the time to constantly monitor your investment then it may not be the right option for you. That being said, the profitability that comes with it often makes it worthwhile.

Margins

Crude oil is in limited supply and it is also eligible for leverage as well. This essentially means that you can buy oil futures on margin, or you can borrow money so that you can buy it. You should note that this is usually done on an exchange and it can also be done through your broker. With the stock market, you might not always have the option to do this but it might be risky if you don’t have the money to start with. For example, if you don’t have a substantial amount of money to invest and you take out a large margin that is more than you can afford then you may find that you lose out on a considerable amount. That being said, you also have the chance to make a huge profit as well, so it really does come down to your own personal situation and the way that you feel about it.

Stabilisation

The stock market can be replaced and with some things, prices can actually be stabilised. With oil, it is a limited supply. This means that the price of oil will probably go up regardless of what happens and this is a very important concept that you need to understand. Of course, if you want a reliable investment that is going to pay off in the short-term then the stock market may be a better option. You may find that it gives you more options and you may find that you don’t have to wait long to get a return. With oil, you could be waiting days to get a return or even years, but when you do that return will probably be very substantial if you play your cards right.

Your Portfolio

If you do decide to invest in futures then you need to open up a futures account online. When you do get everything set up, you can then start to plan out your investment. You should note that when you try and open up your futures account, there isn’t a huge chance of you being accepted so you need to plan out your application carefully. A lot of futures lose a lot of their value as they near their expiration date so if you are going to invest in things like this then you do need to move quickly. With the stock market, things never really lose their value near to the end, but they can depreciate over time if something happens to go downhill in the real world.

Making Intelligent Decisions

It doesn’t matter whether you want to invest in futures or whether you want to try and invest in the stock market because you really have to do your research either way. You need to look at charts that show supply and demand, and you also need to take into account any political news that is happening right now. World events also need to be taken into consideration as well and this is especially the case if you are looking into futures.

So there are a lot of differences between futures and stock markets. By taking the time to understand them both, you can be sure to get a good result out of your investment. You can also be sure to make a huge amount of profit at a later date as well, so this is something else that you need to keep in mind.