Lesson 42: "Friday, September 28th, 2001"
On this date, Mrs. B was not stopped out and her order to buy a second contract
did not fill. Chicago May 2002 Wheat Futures closed on Friday at $2.85, down
3 cents for the day. After the close, Mrs. B called her commodity broker and
gave her (Mrs. B's brokers are a team, sometimes Mrs. B speaks with a "he"
and other times with a "she") the following order,
"Buy 1 more contract of Chicago May Wheat Futures for me on Monday "at
the market, on the close" - if and only if, May Wheat Futures close Monday
at $2.90 or higher".
Mrs. B's broker responded in the same fashion as her partner had responded on the
previous day, "I will try to place your order Monday if you won't hold me responsible
in case I make a mistake and the order does or does not fill at the price it should".
Mrs. B's calm response again was, "I won't hold you to it, just do the best
you can". With that her broker accepted the order.
Do you think Mrs. B's decision to possibly double her May wheat futures position
on Monday is a good decision? Mrs. B would very much like your input.
Do you agree or disagree with her decision? To let Mrs. B know your opinion,
Why is Mrs. B trying to buy a second contract and what is she going to do if her
order fills on Monday and she has doubled her position by that day's close?
The answer to this question can be found in the next lesson.
Proceed to lesson 43 by clicking here