Commodity price versus futures price? ?

Can someone please explain the basics behind trading a commodity like natural gas? Is it possible to trade natural gas at the current market price that you see day to day or is the only way to trade commodities through futures? and what is the correlation between the current day market value of natural gas and the futures value?

2 Responses to “Commodity price versus futures price? ?”

  1. PHOENIXJMARK Says:

    You ask a very good question. Commodity prices that are quoted for any given item, gold, silver, copper, natural gas etc. are for immediate buying. The futures are just that. You are buying future items in the advancing months ahead. I doubt you will be taking possession of 10,000 cubic feet of gas or 100 troy ounces of gold so buying futures is a very risky business. You have the chance of margin calls and losing tens of thousands of dollars. Sorry to burst your bubble….

  2. Lawrence E Says:

    If you want to avoid going broke on the margin calls with futures, but still feel you have a handle on the eventual direction of Natural Gas, trade Call/Put Options.