Series 3 - National Commodities Futures   Speculating -
Profit/Loss Calculations For Speculative Trades  Of the 120
questions on the Series 3 exam, you can expect around 16 on
speculating in futures, with an emphasis on speculation in
financial markets.  Profit/loss Calculations For Speculative
Trades, Including Spreads We have focused up to now on hedging,
the process by which parties with a direct interest in buying or
selling the underlying commodity give up potential financial
windfalls in order to ensure they won't face catastrophic
losses. The other side of the equation, though, is speculation,
assuming the risk that the hedgers want to get rid of and
trading with the objective of achieving profits through the
successful anticipation of price movements.  Speculation is
often unfairly maligned. Speculators provide liquidity to the
market; without speculating, there can be no hedging. By taking
positions opposite the hedgers, speculators act in effect as
insurers. The money the hedgers indirectly "pay" sp