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Outright Futures Position

What does Outright Futures Position mean?

An Outright Futures Position is taken by a trader when he enters into a long or short trade on an underlying futures contract that has the potential for unlimited profit, but also carries the risk of unlimited losses.

Futures Knowledge Explains Outright Futures Position

Outright futures are also called naked futures because they leave the investor highly exposed. To reduce risk, the investor may choose to purchase a protective, offsetting option or the underlying security itself. A position taken by the trader that has all risk based upon the futures position itself, and has direct Exposure and risk according to the fluctuations of price, without being hedged. In other words, if the trader takes a position in the gold market by purchasing the contract without buying options to cover the possibility of falling prices, they are said to have an outright futures position.

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