Crude oil can be effected by political tensions and people's views on
the economy; it is a very volatile market and can easily move 200 to 400
points a day. It is as such one of the more volatile markets out
there.
As one of the most significant resources in the world, crude oil is also
a staple financial instrument for hegder, traders, and investors all
across the globe. Keeping up with crude markets requires a keen
attention to detail as well as patience in what is typically a volatile
industry. For those looking to dabble in crude oil futures, there are a
number of options available, leaving some to wonder where to begin.
- New York Mercantile Exchange: When it comes to U.S. exposure, you will be hard pressed to find a better starting point than the NYMEX. The exchange offers multiple futures contracts, some of them optionable, for both West Texas Intermediate (WTI) and Brent crude. One benefit to these contracts is that they trade Sunday-Friday between the hours of 6:00 p.m. and 5:15 p.m (CST), meaning that investors can make a play for approximately 23 hours every day (there is a 45 minute break period between each day).
- Intercontinental Exchange: Known as the ICE, this exchange offers two different contracts for Brent crude and one for WTI. The WTI contracts represent 1,000 barrels and are quoted in U.S. dollars and cents. Note that these contracts are nearly identical to those offered on the NYMEX.
- Multi Commodity Exchange: For those looking to invest abroad, the MCX offers exposure based out of India. A single contract for Brent and WTI is available on this foreign exchange, with WTI contracts representing 100 barrels each, making them ideal for those with smaller capital bases to work with. Note that the contracts are available Monday-Saturday, with no trading occurring on Sunday.
