Multinational corporations, currency futures 02
However, the speculator takes advantage of price fluctuations by purchasing low and then selling high. They essentially become “middlemen” between buyers and sellers, taking on higher levels of risk but also potentially earning greater rewards when done correctly. Hedgers and speculators both can benefit by exchanging commodities buying and selling risks.
One example is known as “reversing trade” which occurs when a hedger buys one contract then immediately sells another at different prices thereby offsetting any potential losses due to fluctuating markets conditions. Daily price limits, which are important features currency futures, provide safeguards for market participants and keep trades transparent. They also reduce speculation risks.