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ColoVT82

Joined: 01/01/2005 Posts: 9973
Likes: 6772


Still dumbstruct over yesterdays oil price debacle.


At one point price of a barrel of oil in may futures contract was around -$40. I wasnt quite sure at the time, but i am now. This was the first time a negative # was allowed in a commodity exchange.

Ok, so what you ask. Well, lets pretend you are an investor (please dont play in the commodity markets unless you know what your doing, go with energy etfs if you must). Up until yesterday, the worst possible day you could have with ANY commodity investment was at a price of zero. That is, if you placed a $10,000 bet on the table, the worst you could lose was all of it. Now, you lose more than your original bet. That is troubling. Very. If this leaches into other marketswell, im not even going to go there. In other words, the risk you once thought was bounded to $10,000 is now, not bounded by that limit.

Posted: 04/21/2020 at 2:33PM



+0

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