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Coal Futures Trading Basics

Coal futures are standardized, exchange-traded contracts in which the contract buyer agrees to take delivery, from the seller, a specific quantity of coal (eg. 1550 tons) at a predetermined price on a future delivery date.

Coal Futures Exchanges

You can trade Coal futures at New York Mercantile Exchange (NYMEX).

NYMEX Coal futures prices are quoted in dollars and cents per ton and are traded in lot sizes of 1550 tons .

Exchange & Product NameSymbolContract SizeInitial Margin
NYMEX Coal FuturesQL1550 tons
(Full Contract Spec)
USD 18,900 (approx. 16%)
(Latest Margin Info)

Coal Futures Trading Basics

Consumers and producers of coal can manage coal price risk by purchasing and selling coal futures. Coal producers can employ a short hedge to lock in a selling price for the coal they produce while businesses that require coal can utilize a long hedge to secure a purchase price for the commodity they need.

Coal futures are also traded by speculators who assume the price risk that hedgers try to avoid in return for a chance to profit from favorable coal price movement. Speculators buy coal futures when they believe that coal prices will go up. Conversely, they will sell coal futures when they think that coal prices will fall.

Learn More About Coal Futures & Options Trading

How to Start Trading Coal Futures

To buy or sell coal futures, you need to open a trading account with a broker that handles futures trades. Most online brokerages out there only deal with stocks and stock options. Only a few such as TD Ameritrade lets you trade futures and futures options as well. TD Ameritrade also provide a virtual trading platform where beginners can try out futures and options trading in real market conditions without using real money.

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