Making Money In Commodities

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Making Money In Commodities

  1. 1. Making Money in Commodities©.<br />A Business Guaranteed to Change Your Life.<br />
  2. 2. 8/18/2011<br />©MMIC<br />2<br />Making Money in Commodities©<br />Making money in commodities <br />is about the one perfect business in the world, its about making money.<br />Let us consider making money…<br />The only way to make money is to do business. <br />There is no other choice!<br />
  3. 3. 8/18/2011<br />©MMIC<br />3<br />Starting a New Business<br />What is required to start a business which will cover our expenses and provide us with enough to one day retire? <br />- Know how – project plan, idea, concept…<br />- Experience – previous experience in doing business…<br />- Legal – company formation, insurance, lawyers, accountants<br />- Location – office, shop, factory, machinery, decoration, stock<br />- Employees – managing & training them and keeping them…<br />- Product / service – delivery, quality, competition…<br />- Customers– advertising, credit, collections, bad debts…<br />- Suppliers– paying on time, opening l/C’s…<br />- Capital / money – own, friends, investors, banks<br />
  4. 4. 8/18/2011<br />©MMIC<br />4<br />Starting a New Business<br />- After we succeeded in all the requirements what can we expect?<br /><ul><li>What would be our annual return on investment ROI?
  5. 5. When will our initial capital be returned?
  6. 6. How long can we expect our business to last? Seems like starting a business is a difficult business</li></li></ul><li>8/18/2011<br />©MMIC<br />5<br />The Perfect Business…<br /><ul><li>Will be run entirely by you, and you alone.
  7. 7. Require no attorney, accountants, or bookkeepers.
  8. 8. Have no collection problems.
  9. 9. Have no inventory.
  10. 10. Are never advertised.</li></li></ul><li>8/18/2011<br />©MMIC<br />6<br />The Perfect Business…<br /><ul><li>Have no customers.
  11. 11. Need no employees.
  12. 12. Can be established with as little as $10,000 to $25,000.
  13. 13. Thrive in any economic climate – inflation, hyper-inflation, recession, or an outright depression.</li></li></ul><li>8/18/2011<br />©MMIC<br />7<br />The Perfect Business…<br /><ul><li>Require very little of your time. A multi-million-dollar empire, in fact, can be run on about two hours of your time every day!
  14. 14. Allow you to continue working (if you want to), retiring, vacationing, recuperating or whatever you want!</li></li></ul><li>8/18/2011<br />©MMIC<br />8<br />The Perfect Business…<br /><ul><li>Require no more facilities or utilities than you now have in your home or office.
  15. 15. Require no education, classes, licenses, applications, fees, dues, or registration. All the training you’ll need to get going is included in making money in commodities course.</li></li></ul><li>8/18/2011<br />©MMIC<br />9<br />The Perfect Business…<br /><ul><li>Have no competition.
  16. 16. Will not be subject to employee or customer theft (since there are no customers or employees!).</li></li></ul><li>8/18/2011<br />©MMIC<br />10<br />Welcome to the Perfect Business!!!<br />Commoditiestrading…<br /><ul><li>Know how – you will learn all you need to succeed immensely in 4 days.
  17. 17. No experience required! Anybody can start.
  18. 18. All legal procedures can be completed by filling 4 forms. It takes 5-7 days before you can start trading.
  19. 19. Location – your armchair, or the beach wherever you have Internet connection.</li></li></ul><li>8/18/2011<br />©MMIC<br />11<br />Welcome to the Perfect Business!!!<br /><ul><li>No employees required!!!
  20. 20. Products – the best products in the world in unlimited supply.
  21. 21. No customers or suppliers – cash business.
  22. 22. Money – small capital, no loans…</li></li></ul><li>8/18/2011<br />©MMIC<br />12<br />Starting a New Business<br />What can we expect from commodities trading?<br />When will our initial capital be returned?<br />Immediately<br />How long can we expect our business to last?<br />Its been around before us and its going to be around even after us…<br />
  23. 23. 8/18/2011<br />©MMIC<br />13<br />Starting a New Business<br />What would be our annual return on investment – ROI?<br />Before we see the ROI let me first show you this great business and then we will see a real example…<br />
  24. 24. 8/18/2011<br />©MMIC<br />14<br />What Are Commodities?<br />Commodities are necessities of daily life.<br />We will trade in seven types of products:<br />Grains – corn, wheat, soybeans…<br />Currencies – euro, yen, Swiss franc, pounds…<br />Metals– gold, silver, copper, platinum…<br />Energies – crude oil, natural gas…<br />Foods– sugar, cocoa, cattle, coffee…<br />Soft – cotton, lumber…<br />Indexes – Dow Jones, Nasdaq, S&P.<br />There are thousands of commodities.<br />
  25. 25. 8/18/2011<br />©MMIC<br />15<br />What Happens at Exchanges?<br />A commodity exchange is where commodities & commodity futures are traded. A commodity exchange is a central place where all the buyers and sellers meet to buy and sell their commodities. <br />
  26. 26. 8/18/2011<br />©MMIC<br />16<br />Chicago Board of Trade (CBOT)The Exchange Floor – This Is Where Trading Takes Place<br />
  27. 27. 8/18/2011<br />©MMIC<br />17<br />What Happens at Exchanges?<br />It is a very liquid market. A buyer does not have to find a seller and vice versa. Business takes place in a central place called a pit where all the buyers and sellers gather and conduct trade. The price of a commodity is determined at this pit.<br />
  28. 28. 8/18/2011<br />©MMIC<br />18<br />What Happens at Exchanges?<br /> A commodity exchange is created and managed by a group of commodity traders and ruled by law. The first exchange was formed in France in the 15th century. The first exchange in the USA was established in the year 1848.<br />
  29. 29. 8/18/2011<br />©MMIC<br />19<br />What Happens at Exchanges?<br />A commodity exchange helps control the fluctuation of prices and provides stability and liquidity to the farmers, producers, buyers and sellers and ultimately benefits the common man.<br />
  30. 30. 8/18/2011<br />©MMIC<br />20<br />What Happens at Exchanges?<br />The exchange decides which commodities will be traded there. It decides qualities, quantities and delivery periods. Each exchange has its own set of rules and regulations.<br />
  31. 31. 8/18/2011<br />©MMIC<br />21<br />What Happens at Exchanges?<br />The most important function is that the exchange guarantees the buyer and seller will get paid and will receive the goods on time and as per specification. <br />
  32. 32. 8/18/2011<br />©MMIC<br />22<br />Futures…<br />A commodity future or just future as it is usually called, is a commodity, which is to be delivered at a future date.<br />e.g. Cotton for delivery in May 2001is a May 2001 cotton future.<br />Every future has a different price though it is the same commodity. This depends on the market expectation of the price of the commodity at the future delivery date.<br />
  33. 33. 8/18/2011<br />©MMIC<br />23<br />What Are Contracts?<br />At the exchange, commodities are traded in large quantities, which are set by the exchange and are called contracts.<br />Each commodity future has a different contract size e.g. a corn contract is 5000 bushels, a cotton contract is 50,000 lbs., a silver contract is 5000 oz., A crude oil contract is 1000 barrels. A sugar contract is 112,000 lbs etc.,<br />
  34. 34. 8/18/2011<br />©MMIC<br />24<br />Reading Prices<br />Each futures contract is traded between a fixed period of time every day except weekends. <br />The first price at which business is done after the market opening is called the openprice. <br />The last price at which business is done before the market closes is called the last price or settleprice. <br />The highest price during the market hours is the high price, <br />Similarly the lowest price is the low price.<br />
  35. 35. 8/18/2011<br />©MMIC<br />25<br />Reading Prices<br /> We therefore have four prices every day for every future month for every commodity:<br />Open the open price or first price<br />High the highest price during the day<br />Lowthe lowest price during the day<br />Closethe last price before the market closes<br /> Note: closing prices are also called settle/last<br />
  36. 36. 8/18/2011<br />©MMIC<br />26<br />Margin Requirements<br />Since we are not taking delivery of the commodity as it will be delivered in the future the exchange does not require us to pay the full value of the contract. All that we have to pay to trade a commodity is a margin which is like a good faith deposit.<br /> Each commodity has a different margin decided by the exchange and based on the volatility of the commodity.<br />e.gThemargin on cotton was $1,000 per contract.<br />
  37. 37. 8/18/2011<br />©MMIC<br />27<br />Starting a New Business<br />Now that we know something about commodities let us go back to our previous question of return on investment ‘ROI’<br />Let us take a real life example…<br />
  38. 38. 8/18/2011<br />©MMIC<br />28<br />Make an Actual Trade<br />Let us assume we are today in the morning of the 14th of December 2001. We assume that we wish to buy May 2002 cotton at the open as we expect the price to go up.<br /> We will also assume we will sell the cotton on the close.<br /> We will also assume that we have $25,000 to invest in our account.<br /> If we had invested this in any other good business we could expect a return of 25-40% per year.<br />
  39. 39. 8/18/2011<br />©MMIC<br />29<br />Make an Actual Trade.<br /> The prices on 14th of December 2001 for May 2002 delivery cotton were as follows:<br /><ul><li>High38.90 cents / pound
  40. 40. Low 36.31 cents / pound
  41. 41. Open36.31 cents / pound
  42. 42. Settle38.87 cents / pound</li></li></ul><li>8/18/2011<br />©MMIC<br />30<br />Make an Actual Trade<br />Now let us see what happened:<br />The cost of one pound of cotton at the open on 14th of December 2001 was 36.31 cents/lb and one contract of cotton is 50,000 lbs.<br />Therefore the cost of 1 contract of cotton will be:<br /> = Contract quantity X unit price = total cost.<br /> = 50,000 x 36.31cents.<br /> = 1,815,500 cents or 18,155.00 dollars.<br />
  43. 43. 8/18/2011<br />©MMIC<br />31<br />Make an Actual Trade.<br />Since we have $25,000 in our account we bought only 1 contract.<br />Therefore we bought 1 contracts of May 2002 cotton at the OPEN which was 36.31 c/lb. For $18,155.<br />And we sold 1 contract (thereby closing our position) at the CLOSE, which was 38.87 cents/lb.<br /> At the end of the day we sold the 1 contract at 38.87.<br /> = 50,000 x 38.87.<br /> = 1,943,500 cents or $19,435.<br />
  44. 44. 8/18/2011<br />©MMIC<br />32<br />Make an Actual Trade.<br />Our profit will be:<br /> = Selling price – buying price.<br /> = 19,435 – 18,155 = $ 1,280.<br />Return on investment for this business is:<br /> = Profit / investment.<br /> = 1,280 / 18,155 = 7.05% per day.<br />If we could do this for 100 days in the year we would have a return of 700% on our investment on an annual basis.<br />
  45. 45. 8/18/2011<br />©MMIC<br />33<br />Make an Actual Trade<br />We remember that we do not need to invest the whole value to buy or sell a contract of cotton. All we need to invest is the margin. The margin of cotton was $1,000 per contract.<br />Therefore we can buy more contracts for $25,000.<br /> = Capital / margin = contracts.<br /> = 25,000 / 1,000 = 25 contracts.<br /> (We can therefore buy 25 contracts instead of 1).<br />
  46. 46. 8/18/2011<br />©MMIC<br />34<br />Make an Actual Trade<br />Our profit will be 25 x $1,280 = $32,000 for one day!<br /> Also our new return on investment is:<br />= 1,280 / 1,000 = 128%<br />Now this is more like it! And if we were able to keep doing this for 100 days we would have return of 12,800% annually!!! Or $32,000 profit per day X 100 days <br /> = $3,200,000 profit per year<br />
  47. 47. 8/18/2011<br />©MMIC<br />35<br />Welcome to the most powerful money making business in the whole world!<br />
  48. 48. 8/18/2011<br />©MMIC<br />36<br />WhatYou Will Learn During This Course?<br />Margin & contract specifications<br />Analysis & strategies<br />Three strategies to succeed!!!<br />Workshop for strategies<br />Taking profits & minimizing loss<br />Silver strategy<br />Making a million dollars<br />Names of exchanges<br />Important names & numbers<br />Quote service<br />Support program <br />
  49. 49. 8/18/2011<br />©MMIC<br />37<br />Eng. Hossam who took this course in July 2010, turned $5,000 into $17,600 in four months.He left his job and is now happilyUN-EMPLOYEED<br />
  50. 50. 8/18/2011<br />©MMIC<br />38<br />The Lecturer turned$78,000into$245,000in just 2 weeks!!!<br />
  51. 51. 8/18/2011<br />©MMIC<br />39<br />If you think you Can<br />or if you think you can’t,<br />you’re right!<br />
  52. 52. 8/18/2011<br />©MMIC<br />40<br />Making Money in Commodities©It’s the most Powerful <br />Money Making Business <br />in the Whole World.<br />

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