Commodity Paper Trading
Commodity Paper Trading refers to a system of simulating the real commodity trading process.By engaging in Commodity Paper Trading, the prospective traders can gain a detailed understanding of the commodity trading system, without taking any risk.
The System of Commodity Paper TradingIn the Commodity Paper Trading System, at first, the would be traders carry out detailed market research regarding the price movement of the product, that they want to make the underlying commodity in the actual Commodity Trading System.
After completing the research, when a prospective trader wants to purchase a specific futures contract, he writes down the current price, at which the trading activity would have been carried out. Then, the position of this paper option writing is observed by the would be trader.
This process is repeated for multiple times by the prospective traders. In this way, through this Commodity Paper Trading System, prospective traders gain knowledge about actual commodity trading without putting their wealth at risk.
Types of Commodity Paper TradingCommodity Paper Trading can be of the following two types:
- Self-Guided Paper Training- This is the most old system of executing Commodity Paper Trading. Here, as the name suggests, the prospective traders carry out Commodity Paper Trading on their own. They rely on their own market research and continue the process of Commodity Paper Trading, until they feel confident enough of putting their money in real commodity trading.
- Broker Assisted Paper Trading- In this system of Commodity Paper Trading, the would be traders carry out the process of commodity paper trading, being in touch with a Broker. In this case, with the help of the Brokers, the prospective traders quickly gain a sound knowledge of commodity trading.