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Trading in commodities is a very complex business application. The procedures that need to apply are simple enough, alas to get to such a level, a lot of information needs to be absorbed in a short period of time. We’ve always made it clear–that this is a difficult business to successfully apply and in retrospect, at least 60% of intermediaries who had taken up the study; should have tried something else.What’s left? Millions of ill informed intermediaries who come and go every year, crossing paths with a small number of highly informed PCT’s. But there is a secondary aspect to the study even for those traders who ‘gave up early.’ One who delves in international business will learn a great deal of relative matters to do with international banking, finance and agency. In this sense it never too late to take up an academic level study. Intermediaries for most are role acting the part; but are not concluding on any business, as most don’t have the required skill set, practice or a supportive underlying legal basis to ever effectively do as much. To act as an undisciplined intermediary is indeed a huge waste of time. Pretending to be trading in real deals for most of these intermediaries is an illusion. This was the scenario 1988 and is still evident today at reduced levels - thanks to the FTN Exporting Doctrine of Trade. Many intermediaries didn’t even comprehend that they were only competing with each other and not with end buyers , suppliers and agencies and in fact very few intermediaries have actually dealt with real end buyers or export ready NBC suppliers. A PCT acts upon the opposite premise. An ill informed intermediary becomes a highly informed specialist trader, when they complete studying the FTNX doctrine of trade. Applicants drop the intermediary tag to become a PCT as specified under ITSI as “PIA.” The Intermediary becomes a principal as well as a buyer and seller of commodities in their own name in a very strict and legally applied manner. We can all try new things - but if one is going to give this business a ‘good shot’ at they every least they must be informed about the beast they are going to face, and take on such a beast with the best tools in hand.The prize for taking on the beast and winning is financially huge as are the efforts needed to win such a prize outright.
Focus
It take great focus to remain focused on the objective
A Professional Commodity Trader (PCT) studies the doctrine intently. The term ‘intently’ means 3 to 6 months. The PCT then enters the market place not as an intermediary but a buyer and seller of commodities in its own name; handling one commodity at a time–this means these kind of traders are not ‘commodities’ traders, dealing in stocks (paper dealings).The rules of a stock broker or exchange do not apply to our business and we do not deal in “on the spot” cargo. We apply future based transactions. A PCT sources goods and when secured acts on the secured product and starts the dealing and trading process, until failure of success is apparent–or assurance of supply has expired. This now means the PCT is bearing liability of the whole deal–and that the PCT is first party to a deal not a third party as many may think. Once the study is over, practice needs to take place. Practice serves experience and with experience comes mistakes. We learn by ensuring mistakes are not repeated and we conduct business in a mitigated position, allowing the PCT to drop a deal without being legally liable on the condition no contract has been signed. This is the special attributes of the doctrine as it was designed to protect the PCT when they eventually enter the market place.
Time
Trading in commodities consume time
A large trade deal could take anywhere between 3 months and up to 6 months to successfully closes or fail. Quicker aspect could be applied by USCT advanced traders, however such trade deals are described as rare events. The study period could last up to 6 six months; after this time, practice aspect usually lasts 8 to 12 months before the PCT start to realise that they are actually trading. Within 15 months most PCT should be delving in the business of buying and selling commodities. From this point it could take another year or more before the first deal is closed–for the best albeit the minority of PCT’s. The majority of traders will not a close a deal and often give up trying to close such deals, within 16 months of taking up the study–is our latest assessment.The remaining PCT’s are trading with long term focus–if not a lifetime (Like FTNX has done ). To close a large commodity deal in under 3 years is therefore also a focus point. If a PCT has not arrived at a contract issuance stage on a deal within 3 years, then possibility of a deal ever closing reduces yearly thereafter.The study and practice basis works well because the PCT studies and practices the trading aspect at the same time, reducing the academic level study period greatly. This now delivers the idea that the PCT taking up the study must be focused on the objectives sought– from the very start. They must focus on the long term aspect of trading; they must be prepared to focus on the long term aspect of trading in commodities and must remains focused on what they intend to achieve. The objectives must be apparent from the very start. The omnibus of all objectives applied over the course of a few years should deliver a result–in time, for some, but not all applicants taking up the study. Enacting on a business does not guarantee success. Opening a new business is always a risky proposition whether its a restaurant, a retail store or manufacturing plant; it no difference when trading in commodities - the big difference is that the PCT does not need to outlay huge set up costs as knowledge and practice is what will close a lucrative commodity deal. The risk here is not the financial outlay needed to conduct the study but contemplancy – spending too long in making the first move leads to a lack of motivation usually within the first year of taking up the study. Failing to follow through with the many objectives in a short time after taking the study is the biggest downfall for many practitioners - who simply give up too soon.
Objectives
The objective of the study is to make money.
The biggest objective when trading in commodities is to make money. But this is an end point not a starting premise; many applicants taking up the study were looking to make ‘money’ as a starting premise.The focus is to make a ‘big pile of money’ the kind that cannot be earned working for a wage. The say otherwise its to serve a false narrative.Many small objectives need to be reached, before the finale is assured. The focus is not on the big single objective of making money, but the many small objectives that must be reached along the way– also often referred to ‘steps.’ The first step is to understand what you are studying. The doctrine has taken complex matters of trade and explained them in a very simple way to arrive at a conclusion on each step taken. One cannot be motivated to trade in commodities if they didn’t understand what was studied. One cannot be motivated because they lack confidence. A lack of confidence destroys opportunity and leads to the potential of the applicant to become diminished. The secret here is to pace your study and practice sessions into a structure. “So you work all day and when you come home you are tired.” Structure your study and subsequent trading efforts to suite your lifestyle in a way that you do not become obsessed with only trading and nothing else. Pace your efforts and remains focused on the bigger picture pertaining longevity. Understand what you are studying, don’t dwell too long on the study aspect and start trading whether daily or casually–in your spare time–as soon as possible, is the right perspective.
The First Trading Step
Don’t waste your time on small deals.
Selling a FCL of goods will not generate the kind of financial gains this business could generate and that the market place is very competitive at this level. Selling 100 FCL of a product on a single contract- now you’re talking. Your focus is to become a specialist trader, who deals in large single non break cargo (NBC) shipments and in particular revolving shipments. To learn what it takes to delivery i.e: 2 Aframax shipment of ULS D2 every month for a year or years or 5000 MT of Copper Cathodes per month for 2 years; or even where negotiations over 6 months is leading to 80,000 MT deliveries of black coal per month–for 7 years. Specialised deals are applied by highly informed informed traders.This market place is no so competitive as one may think, as so many new traders in the arena, who turn up yearly are all ill informed. The PCT needs to start the race correctly as the PCT needs experience. Wasting years chasing a few container loads of product will take you away from obtaining the insights needed to conclude of large revolving deliveries. In any case selling a few FCL of rice is not what the study is about; do as much is not that difficult to learn ‘at sight.’ An intermediary must study the doctrine, to gain an understanding at the academic level a strong perspective of what needs to occur especially applying to aspects of rules, laws, finance, banking and legalities. A PCT cannot secure large deals without having specific knowledge to do with said aspects. The intermediary studies the doctrine and reverts to the position of a PCT. The PCT will commence the first step immediately which is to source one single Export ready supplier (NBC), in possession of a large quantity of much sought after goods–on a single large shipment or revolving basis where we all commences by using the FOB delivery mode. The PCT will secure such goods bearing a price that is below spot market or future price basis seen offered by commerce exchanges around the world, which are all mostly prescribed per Kilograms, Barrels, Cubic Metres, Tons or MT basis. When one buys in bulk, one gets a discount on a displayed unit price. This small fact of commercial business is a universal applications. The only time when the importance of supply overrides obtaining a better price is when goods are in short supply; in this situation one may need to pay for goods at a higher price basis, and sell such goods on a higher price basis – at risk of prices drastically falling. A PCT deals mostly in the former aspect and less in the latter aspect.
Golden Rule No:1
Product is secured first
A PCT attempts to buy large revolving lots and to do so in a way that allows the end buyer to get a good price, the supplier to get a good price in where the PCT can make a good gross profit for efforts made. Those who assist the PCT to close upon a deal will earn a commission. Large trade contracts attract discounts on prices. This is the nature of big business operations often defined as ‘productivity.’ The bigger the contract the larger the discount. This is your first step. It may take you weeks months or a year to finally secure a genuine product; but with product secured, real buyers can be tested–without it, you are wasting your time relying on products being offered by other ill informed intermediaries. A PCT will need to fail on one or a few deals is a well versed and tested premises. It’s the second to third large deal that will often close all the way to contract–for good reason; the PCT had learned intently on what needs to occur, due to the study as well as past failures. Complete the study and start trading ASAP is a very important aspect. Contemplation on the study aspect for too long could change you over focus points and objectives. The very first act is to secure a supplier.
This is an educational website. DAVIDE GIOVANNI PAPA Trade expert and leading international best selling author, (ITSI) CATALOGUE: LIBRARY OF CONGRESS USA ISBN 9780566089343 / ISBN 9780566092237.The nature of advice is for intermediaries and matters of agency especially for those acting as a PCT ( buyers and sellers) worldwide . Suppliers and end buyers should contact us via our new trading website. This site is for educational services only. No trade deals permitted. FTNX is unable to advise or service inquiries from applicants located in countries bearing trade sanctions with Australia. Opinions served on this website are personally served by the author without prejudice. Davide Giovanni Papa offers no phone number no mailing address for our Bacchus Marsh or Melbourne City office . While all emails are read, replies may not be served. Matters of trade are located on another website - no service is available on our trading site to intermediaries or PCT’s. FTNX ITS Certificate only served to applicants who have taken our exam and attain a pass mark of 85 from 100 and Certificate can only be sent by hardcopy mail. As the creator of the doctrine ,ITS accreditation can only be served by the author. FTNX has no affiliation with ICC Paris France, but endorses the use of Delivery and DLC rules created by such an entity as a major part of the underlying doctrine. Members wanting to learn matters about such rules intently should purchase booklets from the ICC. Dishonourable people are selling pirated copies of our past outdated beta doctrine, A genuine current and supported FTN Exporting beta doctrine has a unique passcode to open and is served with a USCT logo and number registered with FTNX.The Author is also an inventor as such matters of doctrine and investment projects are also incorporated in the study . Investment projects as per the creation of such-by Entrepreneurs no investment funds are sought via such studies. FTNX Registered Inventions Certificates (FRIC) are legally defined type of privately issued patents that apply special conditions. Only certain types of license can be confirmed to service the application unlike a patent..Ideal for Entrepreneurs dealing internationally apply matters of the FTNX doctrine of trade where FTNX is supervising the license and any transaction occurring when an idea is sold.
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