Track market highs while avoiding downside risk
This unique contract lets you capture potential futures price increases while protecting yourself from downside risk. Its trailing stop out order incrementally “tracks” market increases. But if the reference futures month price decreases below the stop out, the order to sell is triggered.
Along with your trailing stop out, you can also set a target limit order. If the reference futures month market level increases above the target limit order, the order will be executed, establishing your futures price while cancelling the corresponding stop out order. A MarketTracker Working Order contract is a great option for farmers who like a “set it and forget it” approach to grain marketing.
When is a good time to use this contract?
- When you are able to store your grain for a period of time and believe the market will increase during that timeframe
What should I consider before choosing it?
- Your contract could expire before your stop out or target limit order are triggered; you’ll then have to decide whether to sell at the day’s cash bid or enter into a new contract
- If the market immediately trades below your stop out price and fails to improve, you may have to revise the variables of your contract