Investing

Trading Leveraged Commodities

  • Last Updated:
  • Nov 10th, 2017 8:44 pm
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[OP]
Jr. Member
Aug 16, 2015
147 posts
12 upvotes

Trading Leveraged Commodities

I didn't buy amazon or weed stocks and I feel like I will be old and grey by the time these pitiful dividends get me anywhere.

I'm debating liquidating a large portion of equities and just trading commodity ETFs and Notes. Really good traders are making a killing doing this. So easy to go long or short at will and they rarely hold anything for more than a week.

The question is can you do it inside a TFSA without getting hassled ?
6 replies
Member
Jan 19, 2017
463 posts
125 upvotes
kilburn305 wrote:
Nov 7th, 2017 12:05 am
I didn't buy amazon or weed stocks and I feel like I will be old and grey by the time these pitiful dividends get me anywhere.

I'm debating liquidating a large portion of equities and just trading commodity ETFs and Notes. Really good traders are making a killing doing this. So easy to go long or short at will and they rarely hold anything for more than a week.

The question is can you do it inside a TFSA without getting hassled ?
yes, read this : http://business.financialpost.com/perso ... ted-by-cra
Deal Addict
Apr 22, 2014
2733 posts
386 upvotes
Oshawa, ON
ml88888888 wrote:
Nov 7th, 2017 5:52 am
yes, read this : http://business.financialpost.com/perso ... ted-by-cra
I think you meant no, read this: ...

To OP, if you're going to make a killing trading commodities, I wouldn't sweat the tax implications too largely. If that's going to be your primary business though you may want to incorporate.
signature removed for inappropriate content
Deal Addict
Dec 11, 2007
1728 posts
297 upvotes
Markham
Attempting to get rich quick, the surest way to destroy wealth.

While you are wasting effort and wealth on stuff like this, and learning hard lessons, you're tossing away the most valuable asset you have, time.
Deal Addict
Jun 27, 2007
3190 posts
512 upvotes
slow and steady wins the race.
I am not sure where you heard it's easy to make a penny day trading, IT'S NOT. True, commodities have no earnings to worry about, but you must understand a lot of technical stuff (futures term structure, supply and demand, etc), be a political analyst (eg oil markets), economist and risk manager all in one.

Markets are irrational right now, just look where Dow was in Sep vs now. But focus on long term vs immediate under performance.
After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: it never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!
Sr. Member
Aug 17, 2008
602 posts
194 upvotes
* I am absolutely NOT advocating you trade the underlying futures *

Having said that, I don't think you understand all the risks and implications involved in your pondering about commodity ETF's.

1 - @dlhunter is 100% right about needing to develop the skills and knowledge required over time. A long long time. You have to be immersed in it. So much so that your spouse will be P.O'd at you.
2 - ETN's do not equal ETF's from a tax perspective.
3 - While there are countless more risks, here's a relatively big one. It's called liquidity. Assuming you are in the NY session, how is your ability to enter and exit? Futures trade 24hrs/business day. ETF's? See my analogy using a car lane as being your trading session. You only get to drive in 1/3 the width as the rest of the world.

Just some thoughts for you to consider.
Images
  • ETF driving lane is narrow.png
Deal Addict
Sep 23, 2009
3914 posts
1106 upvotes
You got this OP, Larry Williams turned $10 K into $1.1 Million in 1987, so it's probably easier today if he could do it before the internet.

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