Add training workflow, datasets, and runbook

training_data/curated/text/3ffeb5c2f1ef468ff0744046271b86a5d8eb571b928eaa1e283d13e7cc584ff5.txt

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+15FOr Beginners Only
+this wide discount, the hedge is still very profitable because the price differential is ultimately 
+far outweighed by the intervening price decline. Thus, the relevant question is not whether the 
+futures-implied cash price is attractive relative to the current cash price, but rather whether it is 
+attractive relative to the expected future cash price.
+ 6. The hedger does not precisely lock in a transaction price. His effective price will depend on 
+the basis. For example, if the cotton producer sells futures at 85¢/lb, assuming a −3¢ basis, his 
+effective sales price will be 80¢/lb, rather than the anticipated 82¢/lb, if the actual basis at the 
+time of offset is −5¢. However, it should be emphasized that this basis-price uncertainty is far 
+smaller than the outright price uncertainty in an unhedged position. Furthermore, by using 
+reasonably conservative basis assumptions the hedger can increase the likelihood of achieving, 
+or bettering, the assumed locked-in price.
+ 7. a lthough a hedger plans to buy or sell the actual commodity, it will usually be far more efficient 
+to offset the futures position and use the local cash market for the actual transaction. Futures 
+should be viewed as a pricing tool, not as a vehicle for making or taking delivery.
+ 8. Most standard discussions of hedging make no mention whatsoever of price forecasting. 
+This omission seems to imply that hedgers need not be concerned about the direction of 
+prices. 
+although this conclusion may be valid for some hedgers (e.g., a middleman seek-
+ing to lock in a profit margin between the purchase and sales price), it is erroneous for 
+most hedgers. There is little sense in following an automatic hedging program. 
+rather, 
+the hedger should evaluate the relative attractiveness of the price protection offered by 
+futures. Price forecasting would be a key element in making such an evaluation. 
+in this 
+respect, it can easily be argued that price forecasting is as important to many hedgers as it 
+is to speculators.
+ ■ Trading
+The trader seeks to profit by anticipating price changes. For example, if the price of December gold 
+is $1,150/oz, a trader who expects the price to rise above $1,250/oz will go long. The trader has 
+no intention of actually taking delivery of the gold in December. 
+right or wrong, the trader will 
+offset the position sometime before expiration. For example, if the price rises to $1,275 and the 
+trader decides to take profits, the gain on the trade will be $12,500 per contract (100 oz × $125/
+oz). 
+if, on the other hand, the trader’s forecast is wrong and prices decline to $1,075/oz, with the 
+expiration date drawing near, the trader has little choice but to liquidate. in this situation, the loss 
+would be equal to $7,500 per contract. note that the trader would not take delivery even given 
+a desire to maintain the long gold position. in this case, the trader would liquidate the December 
+contract and simultaneously go long in a more forward contract. (This type of transaction is called 
+a rollover and would be implemented with a spread order—defined in the next section.) Traders 
+should avoid taking delivery, since it can often result in substantial extra costs without any com-
+pensating benefits.