Well the boys have had their fun, and there is truth in what Wane says.
This is a high risk time to begin trading these products .. more so if you are short funded.
1. How do I calculate the cost of a commodity contract (examples: rough rice, soy bean oil, ethanol, sugar etc)? (side question, would Ethanol be a crude oil?)
A) Ethanol traded on the CME, and carried on the margin sheets under the grains ..
B) To calculate the nominal cost of a commodity, you will need the size of the contract for delivery and the last quoted price.
example: Corn (C) 5,000 bu. x $4.00 per bu = $20,000 per contract..
learn about margin and maintenance / held overnight or day trade - more important than the contract value.
2. How much does commission usually cost for a broker?
A) A full service broker will charge 25 to 100 per trade, plus fees.
3. Does anyone recommend any books, DVDs, newsletters, etc I should read/watch to learn more about the commodity market?
A) You can begin here:
4. How long should I hold the contract for, a few days or wait a few months? Or until the price goes up and I feel I should sell?
A) there is no answer for this one .. each trader must follow their own path
5. How do I determine if it's a bull or bear market?
A) Stock answer = Higher highs / Higher lows = a bull * Lower highs / Lower lows = a bear
however .. it is the time frame that you work that you must watch: intraday, daily, weekly, monthly
you can have different things happening in each .. so you must decide where / how you feel most comfortable
6. How do I calculate profits/losses?
A) best to use a calculator .. seriously, a brokerage statement will have these listed,
just move them to a long term spreadsheet
* Remember * Commodities are marked to market each day -
7. Are there any virtual market games I could play? (besides tradefields)
A) I have no idea .. this is not a 'game' .. games have rules, there are no rules here.
if you question that, see a recent silver chart,
8. How long/how many buys/sells in 'paper trades' should I make before I put real money in?
A) again, there is no simple answer .. each must find their own path.