How MTFE trading works

Jasz

VIP Contributor
MTFE trading is a type of derivative trading. Derivatives are instruments whose value is derived from other underlying assets. MTFE derivatives are financial instruments that are based on the price of oil, gas or other commodities, as well as their position in a contract that relates to the price of oil or gas.

The most common uses for MTFEs are to hedge against price variations in oil and gas markets, or to speculate on future trends in commodity prices. These derivatives can be used for both short-term hedging and long-term investment strategies.

MTFE trading works by using the same software that is used in the stock market. The software runs on a computer and trades the MTFE financial instrument like any other stock or commodity.

There are two ways of doing this:

1. You can use a broker who has been approved by the CFTC as a clearing member, and/or

2. You can run your own software yourself and buy or sell an MTFE from/to another user of your software, or from/to an exchange (like NASDAQ).
 
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