Lumber Trading Strategy – Example, Rules, Settings, Backtest

Lumber is a key material for house construction, and lumber futures is the main method of trading this commodity. Used by builders, furniture makers, kitchen cabinet makers, and so on, lumber currently contributes more than $600 billion to the global economy, accounting for approximately 1% of the global GDP. With a huge chunk of this trading as lumber futures, what is your lumber futures trading strategy?

A lumber trading strategy is a method or technique that can be used to profitably trade the lumber futures market. Lumber futures are a financial derivative contract to deliver or receive a specified quantity of lumber on a future date and at a pre-agreed price. The contract currently trades on the CME Globex platform, and it enables traders to gain leveraged exposure to the softwood market. Hedgers and speculators trade lumber futures for risk management and financial gain through price speculation.

In addition to a backtest, we also answer some questions about the Lumber futures trading strategy.

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