Metal Market

FCOEX is a leading provider of futures brokerage services in the metal futures and options arena. Our clients include speculators, hedge funds, institutions, commodity hedgers, principal producers, processors, consumers, and dealers of the traded metals in all geographical regions. The FCOEX provides its clients with access to high-end trading technology for electronic or pit-traded order execution, metal market-making, trade clearing, and contract administration.
With the FCOEX you can access exchange traded as well as over-the-counter products – from the standard to the exotic.

  • Gold, Silver, Copper, Platinum, Aluminium and Palladium Metal Futures and Options
  • Metal forward swaps and OTC options
  • Metal warrant swaps
  • Inventory management
  • Metal arbitrage swaps and options
  • Physical trading and financing

Research

As an FCOEX client you will have access to market research that is structured to meet a wide variety of needs. Services in this area range from the intra-day analysis of the most recent fundamental and technical developments affecting pricing to longer-term strategic research of supply, demand, and inventory trends of the precious metals group. Market research provides price forecasting, analytical research on hedging and trading strategies, and impact of changing accounting standards, developments in risk management, and current hedge activities and strategic thought in the various sectors of the market.

Basics

Metal futures provide producers, manufacturers, traders and speculators with cost-efficient trading and risk management opportunities. The contracts are firm commitments to make or accept delivery of a specified quantity and quality of a commodity during a specific month in the future at a price agreed upon at the time the commitment is made. However, less than 1% of all metals futures contracts traded result in delivery of the underlying commodities. Instead, investors offset their futures positions before their contracts mature.
For most people, buying and storing the physical form (i.e. coins, bullions, bars) is not a practical choice as an investment. Businesses and individual traders trade metal futures for different reasons, but the primary goal is to profit from, or protect themselves from changes in the price of the underlying metals. Producers and manufacturers, such as companies involved in mining or industrial and manufacturing industries, utilize metal futures for managing or mitigating risk and hedging raw material costs and finished product revenues against adverse price fluctuations. Individual traders or speculators trade metal futures to speculate on the commodity price fluctuations.

Silver Futures

Silver has attracted man's interest for thousands of years, and relics of ancient civilizations include jewelry, religious artifacts, and food vessels formed from the durable, malleable metal. In 1792, silver assumed a key role in the United States monetary system when Congress based the currency on the silver dollar which was used for the nation's coinage until 1965. Today, silver is sought as a valuable and practical industrial commodity, and as an appealing investment. The largest industrial users of silver are the photographic, jewelry, and electronic industries.

Gold Futures

For centuries, gold has been coveted for its unique blend of rarity, beauty, and near indestructibility. Nations have embraced gold as a store of wealth and a medium of international exchange, and individuals have sought to possess gold as insurance against the day-to-day uncertainties of paper money. Gold is also a vital industrial metal -- it’s an excellent conductor of electricity, is extremely resistant to corrosion, and is one of the most chemically stable of the elements, making it critically important in electronics and other high-tech applications. Gold's importance in world markets and responsiveness to world events make gold futures and options an important risk management tool for investors who seek to profit by correctly anticipating price changes.

Copper Futures

Copper, one of the oldest commodities known to man, is a product that directly reflects the state of the world economy. Its softness, color, and presence in nature enabled it to be easily mined and fashioned into primitive utensils, tools, and weapons. Today, it’s the world's third most widely used metal, after iron and aluminum, copper is primarily used in highly cyclical industries such as construction and industrial machinery manufacturing. Copper is the world's third most widely used metal and its fortunes directly reflect the state of the world economy. The copper futures and options contracts are an important risk management tool.

Platinum Futures

Jewelry creates the largest demand for platinum, accounting for 51%. Automotive catalysts take 29% and chemical and petroleum refining catalysts, 13%. Platinum is also used in the computer industry and in other high-tech electronic applications since it is an excellent conductor of electricity, does not corrode, and has a low reactivity with other metals. This sector accounts for about 7% of consumption. Platinum is among the world's scarcest metals; new mine production totals approximately only 5 million troy ounces a year. In contrast, gold mine production runs approximately 82 million ounces a year, and silver production is approximately 567 million ounces. Platinum and palladium are the most widely used of the six platinum group metals, which also includes rhodium, ruthenium, osmium, and iridium. They possess unique chemical and physical qualities that make them vital industrial materials.

Advantages

Trading metal futures offer a number of advantages:

  • The contracts are liquid financial instruments that are standardized by quality and quantity.
  • They offer cost-efficient trading and risk management opportunities.
  • Metal futures prices are widely and instantaneously disseminated, serving as world reference prices.
  • Metal futures markets allow hedgers and investors to trade anonymously through futures brokers.
  • The depth of the market allows the contracts to be easily liquidated prior to required receipt or delivery of the underlying commodity.
  • While metal futures contracts are seldom used for delivery, if delivery is required, performance is guaranteed. Counterparty risk is absent from transactions executed on the exchanges.
  • Contract performance in the metal futures and options contract is supported by a strong financial system, backed by exchange clearing members, including some of the well-respected names in the banking and financial services industries.
  • The exchanges offer safe, fair, and orderly markets protected by its rigorous financial standards and surveillance procedures.
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