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| Elevator I use has what they call a "Minimum Price Contract". Basically, you contract the wheat at the future price, and then they buy you an option(I never can remember puts or calls.) That way, if the price goes up, you get the increased value of the option, if the price goes down, you are only out the cost of the option. Of course, how much that option costs depends on your strike price and how optimistic you are.
As Mr. Senior Citizen says, though, I'm a little concerned new crop wheat has done it's thing if we see a huge acreage number. | |
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