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Re: [RT] Leverage Capital in Soybeans



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Norman:

LOL!  That is pretty funny.  Projecting nefarious motivations on to 
other people where they don't exist.  Very well done.

Yes, any investment can be fully funded to reduce the effect of 
leverage.  How big of an account would one need to properly diversify 
for a kid's college savings account?  One soybean contract is $25K. 
You said you were long various quantities from 1999.  Something does 
not quite add up.

Regards,

John J. Lothian

Disclosure: Futures trading involves financial risk, lots of it!  
John J. Lothian is the President of the Electronic Trading Division 
of The Price Futures Group, Inc., an Introducing Broker.




--- In realtraders@xxxx, "Norman Winski" <nwinski@xxxx> wrote:
> John,
> 
>   One does not have to be leveraged to have a position in futures. 
Can can allocate the full cash value. For example, if a Soybean 
contract is for 5,000 bushels and the priice is $5, the full 
underlying value is $25,000.
> One can allocate the full underlying value and virtually reduce 
leverage to zero. One does not have to buy a farm or elevator to 
reduce leverage to invest in Soybeans. However it is probably true 
that if one takes a long term view on the futures markets, the number 
of transactions is likely to drastically drop. This will thereby 
drastically reduce the income of the futures account rep. I can see 
why you may be inclined to discourage this approach.
> 
> Best Wishes,
> 
> Norman
> 



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