That is how a trader makes money. Their broker works for them and takes their risk. Commodity Brokers Makes More Money Than You Think

Commodity brokers are a big part of the trade that goes on. What a broker does is buy one commodity at a low price and sell it at a high price, then when the price goes down they buy it back at a lower price.



The reason that this is called a "short position" is because the profit is made when the stock goes up. When it drops down they make money because they still own it.


The broker can do this because it is the bank's job to take the risk. This gives them an advantage because they can take as much risk as they want without anyone else knowing. When the market fluctuates the banker's job is to make money off of the risk and make their living.


The risk comes with it, because if the market moves against the trader they will lose their profit. And that is why the trader has to pay.


What most traders don't know is that the bank also has a big part to play in how they go about making the profit. They have to allow the trader to make the losses too, so that they don't have to take on the risks.


What happens is that as a trader and the market moves against them they keep selling until they have enough to pay for the losses and they profit from those trades. Meanwhile, the bank has the maximum amount of stock that they can allow into the market at a given time.


In effect the banker gets all the profits while the trader only takes the losses. This is how they get paid the big bucks.


It is not true that a trader only makes money if they lose money. It is all a game of chances come in different shapes and sizes.


Traders are always looking for better odds. If there is a profitable spot then they will look to get in there.


So they turn to the banks for help. What a banker will do is go out and buy all the positions that they think may be profitable and they will lose money on those transactions, and then they will buy more.


In essence the bank will trade with you so that they get the right kind of profits. They will take the best price and raise the price so that you get more than what you think you are worth.