What are feed cattle futures?

Feeder Cattle futures are financially-settled to the CME Feeder Cattle Index. Once cattle have reached their potential to gain and weigh between 1,050 and 1,500 pounds, they are referred to as fed or live cattle, and are represented by CME Live Cattle (LC) contract. The Live Cattle futures contact is physically delivered.

How do options bets work in live cattle futures?

An options bet succeeds only if the price of live cattle futures rises above the strike price by an amount greater than the premium paid for the contract. Therefore, options traders must be right about the size and timing of the move in live cattle futures to profit from their trades.

How to trade live cattle?

One way to trade live cattle is through the use of a contract for difference (CFD) derivative instrument. CFDs allow traders to speculate on the price of live cattle. The value of a CFD is the difference between the price of live cattle at the time of purchase and its current price. Many regulated brokers worldwide offer CFDs on live cattle.

How much does a live cattle futures contract cost?

Each Live Cattle futures contract represents 40,000 pounds with a minimum price fluctuation of $.00025 per pound, or $10 per tick. The contract trades Monday-Friday from 8:30 a.m. to 1:05 p.m. Central Time (CT).