RE: Negative Crude Oil Give Away For Idiots
Two things. Futures market, and spot market. Futures is a security, buy or sell in advance for a nominated price at a stipulated date. This is the one that causes the native value. You can't take this contract when someone is paying you to own their contract. The clock start ticking once the contract expire! It's a time bomb. Once you take that 36 dollars and the bomb set off, next worst nightmare is, the transporter send you a bill of 500 dollars so they can send you the 40 barrel of crude oil. And next day, 40 barrel of oil unloaded Infront of you house 😂😂😂 I don't wanna know how can you get rid of them, and nobody wanna buy crude oil unprocessed.
Spot market, you never own the oil and never will. The moment you put down the contract, your clock start ticking. This is different than time bomb. This is lethal injection. You'll have to pay swaps(interest). You borrow the oil when you buy; someone borrow the oil you don't have when you sell. But the actual oil price on this market will never go below 0. Check out my last screenshot, enlarge it and you'll see there's negative 5 dollars on each row. That's the amount of swap I'm paying when I BUY. Everyday pay this amount, including weekends and Wednesday pay double 😂
Wow! I never knew there is more to the process. It really means investors are really going through a lot then most especially since there is a drop in price of oil. I was really thinking it works like that of cryptos not knowing it's very different.
Thanks for your lovely reply with love from @hardaeborla 💕❤️💕
If I tell you this is my first time looking into oil, do you believe me? Come join me in my progress as I explore more to this financial tool. The only difference is, we always do the opposites. When everybody sells, we buy. When everybody buys... we'll decide to hodl or sell. The upside is always unlimited, but the downside is 0. So, we can measure the distance and decide.