Profit from Oil Futures

[valuesystem]

On July 3rd, 2008 I entered into a long position on crude oil futures. At the time, the future for December 2012 sweet, light crude oil was priced at $141.25. A few days later, the price of oil began to fall. For the past five months, I've been holding on to this position, believing that oil is definitely worth much more than $141.25 per barrel

Comments

[sir_bissel]

Just wondering, but why sell now? Is it just not likely that oil prices will go back up? Do you need the money now and thus aren't willing to sit on it? Or maybe take the money out and buy when oil prices are even lower, or something?

[valuesystem]

Because with futures, something is not actually being purchased. It is a bet that the item will become more or less valuable. So our bet was that oil would go up. For every 1 cent it rose, we would gain $10. And the same in reverse