The
futures and commodities market was originally established in the
United States in the late 1800s. The original intent was to help
smooth out major price fluctuations that occurred when there were
either shortages HFT Shield or surpluses in the marketplace. At the time,
international commerce on the scale that it has reached in the past
two hundred years was unfathomable. Today, trillions of dollars in
raw materials and finished goods traverse the globe at a frenetic
pace.
While
the United States was not the first to lead the world in the
industrial revolution, it became the key architect in the development
of the world's international commerce that we enjoy today. The United
States' influence has brought about a financial model that is being
emulated across the globe. Countries all over, such as the
economically motivated European Union, as well as India and the
politically communist but economically capitalist China, are
developing their market economies as quickly as they can. While these
countries are important, they are just the tip of the iceberg in the
number of countries working hard to build up their burgeoning market
economies.
In
the wake of this robust global economic growth, the once-humble
beginnings of the U.S. futures and commodities exchanges have taken
on a new role. As raw materials from various countries must compete
against one another, currency rate fluctuations, and the economic
reality of interdependent economic policies, futures and commodity
exchanges have popped up all over the globe. Commodities contracts
such as soybeans, oil, and gold, once dominated by the U.S.
exchanges, the Chicago Board of Trade, the Chicago Mercantile
Exchange, and the New York Mercantile Exchange, have found themselves
sharing space and multiple time zones with newly formed exchanges in
India, China, and Dubai.
Where
once the U.S. exchanges held a virtual monopoly in offering commodity
and futures exchange contracts, they are now faced with fierce
competition from various exchanges in other countries and the
entrance of new players onto their domestic soil. As opposed to being
leaders, they are now pressed into taking a reactionary role. Where
once their contracts set the tone in volume and price discovery, many
other similar contracts are beginning to gain prominence worldwide
and are dictating price and market relevance.
In
the midst of all of this is the trader. Whether retail or
professional, the growth of the 24-hour global trading marketplace is
playing a significant role in determining everyone's long-term
success. The trader's ability to adapt to information, both technical
and fundamental, as well as his ability to be serviced in multiple
marketplaces are becoming more and more relevant. There is no special
secret to trading in this new environment; it simply becomes more
important that you be able to process information, while at the same
time being able to protect yourself from activities occurring halfway
across the world while you sleep.
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