WASHINGTON, July 26 (Xinhua) -- Data from U.S. Commodity Futures Trading Commission on Friday showed that market speculators held a net long position of 4,120 soybean future contracts for the week ending July 23.
Market speculators are non-commercial investors.
Meanwhile, commercial traders that are commonly treated as hedgers also held a net long position of 13,355 contracts.
Speculators and hedgers are different types of investors. Speculators try to make a profit from the assets' price volatility, whereas hedging attempts to reduce or "hedge" the amount of risk created by price volatility during the holding period of the assets.
When investors "long" some kind of financial asset like currencies or commodities, they hold a bullish view on the asset and belief that it will increase in price.
The soybean futures, traded at Chicago Board of Trade, are derivative financial contracts that obligate the parties to transact an underlying asset at a predetermined future date and price. The underlying asset of each contract includes 5,000 bushels of soybeans.