Tiptoeing into Futures Trading
Trading in commodities futures has led many amateurs to bankruptcy; for those who play the odds like a gambler often suffer the same big losses. But, while the futures market can be tricky, those who take the time to really study the market can develop a strategy for investment which consistently brings success. Profits can be big, as futures investors only need to put up a fraction of what the total purchase price would be. You should never risk more than you could afford to lose - commodity prices can move up and down so quickly that fortunes can be made or lost in a matter of hours. There are as many successful trading systems as there are successful commodities traders. There are commodities trading newsletters which present and analyze successful trading approaches. Once a system has been decided upon, realistic investment goals must be established and adhered to. There are also managed commodities accounts which can take some of the constant monitoring out of commodities investment. Commodities investment can be exciting, and profitable, if played correctly.
Publication Name: Money
Section 214 of the UK Insolvency Act of 1986 contains provisions on wrongful trading by corporate directors. The law defines wrongful trading as a civil and compensatory offense rather than penal as in the case of fraudulent trading. According to the Insolvency Act, directors can be charged with civil liability and compelled to contribute to the firm's assets under certain conditions. Accountants and other financial advisers should also understand the legal implications of this legislation for them. Accountants acting as advisers to directors can be held responsible for wrongful trading but their liability will be confined to their professional capacity as advisers. To avoid potential legal actions, it is essential for financial advisers to know the difference between the initial adoption of a wrongful trading position and the continuance of such trading.
Publication Name: The Accountant's Magazine
The pricing of bank bill futures and FRA contracts in New Zealand
This study examines pricing in the bank bill futures and forward rate agreement (FRA) markets. The study finds (i) the bill futures market is more transactionally efficient than the FRA market, and (ii) the unbiased expectations hypothesis generates more accurate estimates of bill futures and FRA yields than the cost of carry hypothesis. The first result reflects impediments to FRA market arbitrage such as illiquidity, minimum trade sizes and credit limits. The second result contradicts US evidence but is consistent with the leading role played by the bank bill and interbank dealers in New Zealand interest rate markets. (Reprinted by permission of the publisher.)
Publication Name: Accounting and Finance
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