Yeah but the speculators provide a liquid market for companies that want to lock in prices for commodities.
That’s a good thing.
These insane spikes don’t happen that often and you’re right, a speculator can be wiped out overnight if they’re on the wrong side of history.
Especially when margin is only 5 percent.
I would always use some kind of combination of future/options or just buy options where the loss can only be a set amount
That margin stuff is dangerous.
In the Hallmark Channel musical version of “A Christmas Carol” Scrooge & Marley were commodities speculators as well as predatory lenders.
No sympathy—only tears for their repentance.