Spread Betting on Copper

Where to Spread Bet on Copper

Commodities
Gold (spread size)	4	5	5	4	4	4	4
UK Crude Oil (spread size)	5	5	4	4	6	4	5
Commodities (min stake)	£1	£1	£1	£1	£0.50	£0.50	£1
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How to Spread Bet on Copper

The Spread Betting Market:	Copper (March) Futures
Spread Betting Price:	$3.7443 - $3.7483
What This Means:	Now you can spread bet on the Copper Futures market settling:   Higher than $3.7483, or   Lower than $3.7443 At the close of trading on the settlement date for the 'March' futures market, 24 February 2012. Remember that, as this is a futures trade, your spread bet will be automatically closed when the March Copper futures contracts are closed, 24 February 2012. However, you could also choose to close your spread bet prior to the expiry date.
Traded Units:	Futures spread bets on the Copper market are made in £x per $0.0001. Where $0.0001 is $0.0001 of the metal’s price movement. E.g. if Copper moves $0.0035 then you would win/lose 35 times your stake.
Stake Size:	You work out how much you want to trade per $0.0001, e.g. £2 per $0.0001, £4 per $0.0001, £10 per $0.0001 etc.
Brief Staking Exercise:	As an example, if you have a stake of £2 per $0.0001 and Copper changes by $0.0027, you would lose / win £2 per $0.0001 x $0.0027 = £54.

Worked Spread Trading Example | Taking a Bullish View of Copper

You Now Decide to Go Long or Short:	Does your research lead you to believe that Copper will close on 24 February 2012:   Higher than $3.7483? or   Lower than $3.7443?
Let’s Say You Decide to Go Long:	Higher than $3.7483
You Choose How Much to Risk, Let's Assume You Choose:	£1 per $0.0001
So What Happens Now?	You will win £1 for every $0.0001 Copper closes higher than $3.7483 You will lose £1 for each $0.0001 Copper settles below $3.7483
If You Are Speculating on a Market to Rise Your P&L =	(Closing Price - Opening Price) x stake per $0.0001
Scenario 1	Copper moves higher and the quote for the spread betting futures market is revised and is set at $3.7605 - $3.7645.
Time to Lock in Your Profit?	You can now choose to let your bet run to expiry or close it and take your profit. In this instance you choose to settle your trade at the current market price and sell the market at $3.7605.
Your P&L =	(Closing Price - Opening Price) x stake per $0.0001
	($3.7605 - $3.7483) x £1 per $0.0001
	$0.0122 x £1 per $0.0001
Your P&L =	£122 profit
Scenario 2	Copper decreases and the spread betting futures market is revised to $3.7352 - $3.7392.
Close and Limit the Loss?	You can now decide to keep your bet open until expiry or close it, i.e. close your spread bet and limit your loss. In this example you choose to settle your position by selling the market at $3.7352.
Your P&L =	(Closing Price - Opening Price) x stake per $0.0001
	($3.7352 - $3.7483) x £1 per $0.0001
	-$0.0131 x £1 per $0.0001
Your P&L =	-£131 loss

Spread Betting Example | Shorting the Price of Copper

You Decide to Buy or Sell:	Where do you think Copper will settle on 24 February 2012:   Higher than $3.7483? or   Lower than $3.7443?
Let's Say You Sell:	Lower than $3.7443
You Select Your Stake, Selecting:	£2 per $0.0001
So What Now?	You will lose £2 for each $0.0001 Copper settles higher than $3.7443 You will win £2 for each $0.0001 Copper closes lower than $3.7443
When Betting on a Market to Fall Your P&L =	(Opening Price - Closing Price) x stake per $0.0001
Scenario 3	Copper pushes lower and the quote for the metal is adjusted and moved to $3.7351 - $3.7391.
Close for a Profit?	You can choose to let your position run to expiry or close it, i.e. close your trade to lock in a profit. In this example you opt to close your trade at the current price and buy the market at $3.7391.
Your P&L =	(Opening Price - Closing Price) x stake per $0.0001
	($3.7443 - $3.7391) x £2 per $0.0001
	$0.0052 x £2 per $0.0001
Your P&L =	£104 profit
Scenario 4	The price of Copper increases and the market is adjusted to $3.7459 - $3.7499.
Time to Restrict Your Loss?	At this point, you can choose to leave your bet open until expiry or close it, i.e. close your trade and restrict your loss. In this example you choose to settle your bet at the current rate by buying the market at $3.7499.
Your P&L =	(Opening Price - Closing Price) x stake per $0.0001
	($3.7443 - $3.7499) x £2 per $0.0001
	-$0.0056 x £2 per $0.0001
Your P&L =	-£112 loss

Copper Notes:

• Financial spread trading prices from Inter Trader: 18 January 2012
  
  
• Most spread betting firms also give you the option of spread trading on Copper in euros/$0.0001 and US dollars/$0.0001
  
  
• Online spread betting also allows you to speculate on a wide range of other asset classes, for more information also see:
  
  
  • Stock Market Indices
  • Currencies Spread Betting
  • Equities Spread Trading

Demo Accounts for Spread Betting on Copper

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Spread Betting on Commodities

• Spread Betting on Commodities
• Spread Betting on Gold
• Spread Betting on Crude Oil