UK Oil and Gas sector CFDs
US Oil and Gas sector CFDs
Individual oil share CFDs including such varied names as Royal Dutch Shell, Statoil, Total-Fina, Exxon Mobil and many smaller oil company stocks around the world
US Natural Gas CFDs with various expirations
Calculating the margin on a US crude contract
As we analyse the US crude oil market every day in our US report, it is worth looking at this contract to calculate what margin is required on a trade.
The current most liquid contract is the July 2007 CFD, priced at $65.86 to $65.92
The margin requirement on most commodities is 3% of the total contract value.
The tick size is 0.01.
The contract value is calculated by this formula:
((Quantity) x (Price))/ Point= initial margin
Therefore if you were to buy 10 US Crude Oil CFDs at $65.92
(10 x 49.50)/ 0.01 x 0.03 = $1,978 initial margin.
The exposure per tick is worth $10.
For online traders, CFDs are an excellent way to gain exposure to the oil market as a speculative play, for hedging purposes, or when searching for good arbitrage possibilities. The markets are liquid and spreads are very attractive.
About the Author:
Mike Estrey is the Head of Research for Blue Index, specialists in
Online CFD Trading,
Contracts for Difference and
Online Forex Trading.
