Expanding your futures knowledge
- Comparing stock trading with futures trading
- Contract specifications
- Physical delivery vs. cash settlement
- Understanding product moves
- Economic events
Take your trade plan to the next level
- Download the trade plan
- What kind of trader am I?
- What does risk actually mean?
- Managing futures risk
- Utilizing stop orders
Practice what you've learned
When it comes to defining and managing “risk,” each trader may have a unique perspective on both its definition and the methods they will use to manage it effectively. Some traders consider risk as the potential amount they’re willing to lose in a trade. For others, risk could also mean the monetary amount allocated for each individual trade. Still, others may simply look at risk as the level of volatility for any one contract.
While the risk in a trade is typically linked to the loss of money in a trade, it is also what creates potential for profit. Traders should understand the following attributes of a contract to help manage their risk and help them identify products that fit their risk profile.
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This activity does not count towards your lesson completion.
ACCREDITED COURSE
In case you didn’t know, the CFA Institute allows its members to self-determine and report continuing education credits earned from external sources. CFA Institute members are encouraged to self-document such credits in their online CE tracker. CME Institute offers a variety of courses, webinars, and white papers to support your professional education.
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