Buying Stocks

If you buy a stock at $25 and sell a stock at $30 you will make a profit of $5 per share. If you buy a stock at $25 and sell a stock at $20 you will suffer a loss of $5 per share. The total profit or loss will depend upon how many shares you buy and how many shares you sell. If you buy and sell only one share, you will make or lose $5. If you buy and sell one thousand shares, you will make or lose $5,000.

Buying crude oil at $25 and selling crude oil at $30 or buying crude oil at $25 and selling crude oil at $20 would result in the same $5 profit or $5 loss per barrel. In this sense, there is no difference between trading in stocks and trading in futures.