Cocoa Spread Betting


cf_market_short Trading Guide

The CleanFinancial guide to Cocoa spread betting.



Where Can I Spread Bet on Cocoa?

At the moment, you can take a position on Cocoa, and a host of other commodities futures markets, at:



Cocoa Trading News

5 May 2018, 12:56pm, Updated Cocoa COT Report

The latest Commitments of Traders Report (COT) for Cocoa has been released by the CFTC, see our Cocoa COT report below.

We have also updated our Commodities COT Summary Report.

Update by Gordon Childs, Editor, CleanFinancial

» For more see Commodities Trading News & Analysis.



Advert: Cocoa Spread Betting, sponsored by FinancialSpreads.com.
You can spread bet on Cocoa with Financial Spreads.


Where Can I Trade Cocoa for Free?

Trading the financial markets always includes a degree of risk. Nevertheless, if you want to try a completely free Test Account, where you can trial financial spread betting, then see below.

When considering which investment option is right for you, also remember that spread trading, in the UK, is currently tax free*, i.e. it is exempt from income tax, capital gains tax and stamp duty.

If you are interested in a free trading website, you should keep in mind that you are able to take a view on Cocoa commission-free through companies like:


Free Demo Account

Should you want to practice with a Test Account that lets you try out spread betting, including trading markets such as Cocoa, then you could look at:

Each of the spreads companies listed above currently provide a Practice Account that allows users to gain experience and test trading strategies.

How to Spread Bet on Cocoa?

As with most key financial markets, an investor can place a spread bet on futures markets, such as Cocoa, to go up or down.

If an investor was to look at the Capital Spreads website, they would see the Cocoa July Futures market at $2,275 – $2,283. Therefore, the investor could spread bet on Cocoa:

  Cocoa Spread Betting Example Settling above $2,283, or
  Cocoa Spread Trading Example Settling below $2,275

On the closing date for this ‘July’ market, 11-Jun-12.

Whilst making a spread bet on Cocoa you trade in £x per $1. So, if you decided to have a stake of £5 per $1 and Cocoa moves $27 then that would alter your bottom line by £135. £5 per $1 x $27 = £135.


Cocoa Futures – Commodity Spread Trading Example

Now, if you consider the above spread of $2,275 – $2,283 and assume that:

  • you have analysed the market, and
  • it leads you to think that the Cocoa market will close higher than $2,283 by 11-Jun-12
then you may decide that you want to buy a spread bet at $2,283 and invest, for the sake of argument, £2 per $1.

So, you win £2 for every $1 that Cocoa rises above $2,283. Of course, it also means that you will make a loss of £2 for every $1 that the Cocoa market decreases lower than $2,283.

Looking at this from another angle, if you were to ‘Buy’ a spread bet then your profits (or losses) are calculated by taking the difference between the closing price of the market and the price you bought the market at. You then multiply that price difference by your stake.

So if, on the expiry date, Cocoa closed at $2,338, then:

Profits (or losses) = (Final Price – Initial Price) x stake
Profits (or losses) = ($2,338 – $2,283) x £2 per $1
Profits (or losses) = $55 x £2 per $1
Profits (or losses) = £110 profit

Speculating on commodities, by spread betting or otherwise, doesn’t always go to plan. In this case, you had bet that the commodity would increase. Nevertheless, the futures market might fall.

If Cocoa fell, settling lower at $2,220, then you would end up making a loss and losing money on this spread bet.

Profits (or losses) = (Final Price – Initial Price) x stake
Profits (or losses) = ($2,220 – $2,283) x £2 per $1
Profits (or losses) = -$63 x £2 per $1
Profits (or losses) = -£126 loss

Note: Cocoa July Futures market taken as of 26-Apr-12.


Live Cocoa Chart & Prices

If you would like to review real time charts and prices for Cocoa, you can use a spread trading account. Please note that opening a spreads account is normally dependent on suitability, status and credit checks.

If your new account is approved then you can log in and make use of the prices and charts. These are usually provided for free. The catch? You are likely to get the odd email and/or letter from the relevant spread betting firm.

If you do trade, be aware that spread trading carries a high degree of risk to your funds and you can incur losses that exceed your initial investment.

Though the charts normally vary from platform to platform, to aid your analysis, the majority of charts come with useful tools and features that include:

  • A host of different time periods e.g. 3 minutes, 15 minutes, 4 hours etc.
  • A variety of display options e.g. candlestick charts and line charts
  • Drawing options e.g. Fibonacci Time Zones, Fans and Arcs
  • Chart overlays and indicators e.g. MACD, Relative Strength Index etc.
Charts on Capital Spreads also include other benefits like:
  • BackTesting, Analysis and Optimisation functions
  • Automatic email alerts that trigger when a market hits a certain level

Example commodity chart



The firms listed below offer account holders access to live charts/prices:



Advert: Cocoa Spread Betting, sponsored by FinancialSpreads.com.
You can spread bet on Cocoa with Financial Spreads.



Cocoa Commitments of Traders Report – 15 May 2018 (i)

Futures Only Positions, ICUS, Code 73732, (Contracts of 10 metric tons) (i)

Reporting Firms (i) Non-Reportable Positions (i)
Non-Commercial (i)
Commercial (i) Total Reportable (i)
 
Commitments (i) Open (i) Interest Commitments
Long (i) Short (i) Spreads (i) Long Short Long Short Long Short
113,496 56,109 59,686 117,427 179,947 290,609 295,742 305,050 14,441 9,308
 
Changes from 8 May 2018 (i) Change in (i) Open Interest Changes from
Long Short Spreads Long Short Long Short Long Short
-1,981 -5,420 1,428 1,143 3,961 590 -31 -163 -753 -132
 
Percent of Open Interest for Each Category of Trader (i)
Long Short Spreads Long Short Long Short   Long Short
37.2% 18.4% 19.6% 38.5% 59.0% 95.3% 96.9%   4.7% 3.1%
 
Number of Traders in Each Category (i) Total (i) Traders  
Long Short Spreads Long Short Long Short    
105 68 72 54 49 205 152 247    
 
Long/Short Commitments Ratios (i)   Long/Short Ratio
Ratio   Ratio Ratio   Ratio
2:1   1:1.5 1:1   1.6:1
 
Net Commitment Change (i)  
3,439  

Also see: