Options Strategies

Game Overview

Welcome to “Basis Trader”. This program provides a fun way to learn about commodities marketing tools and concepts such as basis trading, futures, and hedging. Using the interactive, hands-on teaching techniques found in Basis Trader, you can master the basics of commodities trading. Basis Trader simulates basis movement, historical basis patterns, and the arrival of grain based upon actual data collected from real grain elevators in Arkansas, Tennessee, Illinois, Kansas, South Dakota, and Wisconsin.

Marketing Skills Acquired Playing Basis Trader

Thinking in terms of basis. In order to effectively market grain, you must make a complete shift in your thinking from price to basis. Basis Trader teaches you the importance of being able to recognize merchandising opportunities and how to recognize them in a variety of market environments. Basis Trader offers the opportunity you need to develop “basis eyes”.

By using the basis chart with spread lines presented in Basis Trader, you will learn how to assess the market structure and identify changes in the merchandising environment. Basis Trader simulates local customer habits using a snapshot of expected grain flow during the growing season. This will allow you to anticipate short-term moves in the local basis. Basis Trader also provides five (5) years of historical data which allows you to see how basis generally moves in a consistent and recognizable pattern each year.

Committing all bushels to merchandising. The only way opportunity will present itself in merchandising is if grain is properly hedged and turned into a basis position. Basis Trader requires all grain transactions to be hedged using long-the-basis and short-the-basis positions. All purchased grain must be hedged against futures to create a long-the-basis position, and deferred-price contracts are managed using either long-the-basis or short-the basis positions.

Committing to practice. The best teacher is experience, and Basis Trader offers you a wide range of simulation scenarios for learning to market grain. Scenarios include purchased grain, deferred price grain, or a combination of both. You can pick from almost two dozen marketing locations and up to five (5) growing seasons at each location.


Getting Started

The tutorials below will demonstrate the nature of the game and give you a feel for how it works. A more complete set of instructional materials is available for download (click on the link labeled “Download Basis Trader software”, located above and to the left).

note – Flash Player (8.0 or later) must be installed in order to view the tutorials.

Download Tutorials