| Suppose
you think the Dow will close higher; you would BUY the
contract.
Suppose
you think the Dow will close lower; you would SELL
the contract.
You
profit if you buy a contract for a price and sell
it at a higher price or it settles at a higher price.
You
profit if you sell a contract for a price and buy
it ("cover") at a lower price or it settles
at a lower price.
You
can trade on the prices already offered on the exchange
by other members or offer prices yourself to other
members.
|