Futures investment is an investment project that many people are currently paying attention to. Among agricultural product futures, egg futures have always been popular among investors, mainly because of their low cost. So for egg futures, how do experts do it? Here is some relevant knowledge about egg futures, let’s take a look.

How do experts do egg futures?

Egg futures are my country’s first livestock futures variety and fresh agricultural products. In 2013, they were approved by the China Securities Regulatory Commission and listed on the Dalian Commodity Exchange. The price of eggs fluctuates greatly, mainly because of its high elasticity of demand. When egg prices fluctuate drastically, many egg industry chain companies have realized the importance of hedging. Let’s use an analogy to illustrate.

In December last year, the spot price of eggs was 3 yuan, and the May futures contract price was 3.8 yuan. A found that the overall market situation is not good, and the inventory of laying hens remains high. In addition, egg market consumption will fall after the Spring Festival in February, and the price in May may not reach the 3.8 yuan futures market price.

According to his own egg production volume of about 20 tons of eggs in May, A short-sold 4 lots (5 tons per lot) of egg futures contracts in the futures market at a price of 3.8 yuan. Preserve value over time.

The overall market outlook is consistent with A’s expectations. By May, the spot price dropped to 2 yuan per catty, and A had to sell spot eggs at a loss on the market, losing 7 cents per catty, 20 Ton means a loss of 28,000 tons in May.