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Cocoa Exchanges

Details
Category: Commodity

 

 Originally a bitter beverage for the royal court of the Mayan empire, cocoa manufacturing has develop into a world industry. At this time, cocoa trees are predominantly grown in West Africa, primarily processed in the Netherlands and the U.S., and cocoa isconsumed in one kind or one other by each country in the world.

Understanding Cocoa Contracts

Like every commodity contract, cocoa has its personal ticker image, contract worth and margin requirements. To efficiently commerce a commodity, it's essential to concentrate on these key components and understand the way to use them to calculate your potential income and loss. 

Relying on the quoted value, the worth of a commodities contract relies on the present value of the market multiplied by the actual worth of the contract itself. On this occasion, the cocoa contract equals the equal of 10 metric tons multiplied by our hypothetical value of $1,363, as in

Commodities are traded primarily based on margin, and the margin changes based on market volatility and the present face worth of the contract. For example, to trade a cocoa contract on the Intercontinental Alternate (ICE), a trader may be required to keepup a margin of $2,660, which is roughly 19.5% of the face value.

Cocoa Exchanges

The futures contract for cocoa is traded on the Intercontinental Exchange (ICE) and NYSE Euronext.

Details About Manufacturing

The cocoa plant requires a really particular set of circumstances to thrive and prosper. As a small evergreen tree that may turn into 15-26 feet tall, it might probably only develop in areas that are 20 levels north or south of the equator. Naturally, there are very few locations on earth with the fitting climatic elements for the cocoa plant to thrive, and West Africa has emerged because the dominant participant in cocoa production, with roughly 70% of the market share in 2008.

 
U.S. Government Required Disclaimer - Commodity Futures Trading Commission

Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results. CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN. All trades, patterns, charts, systems, etc., discussed in this advertisement and the product materials are for illustrative purposes only and not to be construed as specific advisory recommendations. All ideas and material presented are entirely those of the author and do not necessarily reflect those of the publisher or Tradewins.