On this date, Mrs. B was not stopped out and her order to buy a
second contract did not fill. Chicago May 2002 Wheat Futures
closed on Friday at $2.85, down 3 cents for the day. After the
close, Mrs. B called her commodity broker and gave her (Mrs. B's
brokers are a team, sometimes Mrs. B speaks with a "he" and
other times with a "she") the following order,
"Buy 1 more contract of Chicago May Wheat Futures for me
on Monday "at the market, on the close" - if and only if,
May Wheat Futures close Monday at $2.90 or higher".
Mrs. B's broker responded in the same fashion as her partner had
responded on the previous day, "I will try to place your order
Monday if you won't hold me responsible in case I make a mistake and
the order does or does not fill at the price it should".
Mrs. B's calm response again was, "I won't hold you to it, just
do the best you can". With that her broker accepted the order.
Do you think Mrs. B's decision to possibly double her May wheat
futures position on Monday is a good decision? Mrs. B would
very much like your input. Do you agree or disagree with her
decision? To let Mrs. B know your opinion, click
here.
Why is Mrs. B trying to buy a second contract and what is she going
to do if her order fills on Monday and she has doubled her position
by that day's close? The answer to this question can be found
in the next lesson.
