The $3 trillion oil market has just gotten more accessible than ever: No longer a 'rich man's game'
Article excerpt
Highlighted: the sentence this signal was extracted from
In this article Oil trading was once largely the preserve of commodity houses, institutional investors and professional traders able to make bets involving thousands of barrels at a time. That barrier has gotten much lower. CME Group began offering a new futures contract Sunday that represents 10 barrels of West Texas Intermediate crude, which means a trader would pay about $860 at current prices. This compares with 100 barrels for CME's Micro WTI contract and 1,000 barrels for its standard contract. The move marks the latest step in what some market watchers describe as the "democratization" of oil trading, following years of growth in online brokerage platforms, exchange-traded funds and smaller futures contracts. "Trading oil used to be a rich man's game," said Zavier Wong, market analyst at eToro Singapore. "It wasn't that retail couldn't access the market, but it was heavily gatekept by the size of the contracts," he said, adding that online brokers, contracts for difference and ETFs have since transformed dynamics. "You don't need a berth or a six-figure net worth to hold a view on oil anymore, so the ability to have an opinion and to act on that opinion has become democratized." Retail interest is already rising, especially during periods of market stress. The number of oil trades handled by eToro was nearly 16 times greater than a year earlier in the three months...
Keep reading with a free account
The rest of this article, and every signal for CME, is in your free account.
