BACHELOR IN BUSINESS ADMINISTRATION (Hons)
FINANCE (BA242)
FIN 645 FUTURE AND OPTIONS
INDIVIDUAL ASSIGNMENT 1
FUTURE TRADING PLAN (FTP)
PREPARED BY :MUHAMMAD HAZIM BIN MOHD ASRI
ID NUMBER : 2019620422
PREPARED FOR : DR. MD KHAIRU AMIN BIN ISMAIL
SUBMISSION DATE : 11 December 2021
TABLE OF CONTENTS
Number Content Page
1 Acknowledgement 3
2 Introduction
Types of Future Trade 4
Trading Plan For Future Traders
Strategies For The Future Trading
3 Technical analysis
Technical Indicator
i. VOLUME (Explain + Chart)
ii. MACD 5-9
iii. STOCHASTIC RSI
iv. RSI
v. MOVING AVERAGE
4 Fundamental Analysis 10-11
5 Expert Options 12
6 Conclusion 13-22
7 References 23
8 Appendices 24-26
2
ACKNOWLEDGEMENT
Assalamualaikum, With Allah's blessings, I can successfully complete my future
trading simulation report in the name of Allah, the Almighty and Merciful. This assignment's
progress and final completion required a great deal of direction and assistance from a large
number of people. I'd want to offer my heartfelt gratitude to a few folks who are assisting me
with my project. We had been briefing on this assignment since the beginning of the
semester. First and foremost, I'd want to express my gratitude to my instructor, Dr. Md.
Khairu Amin bin Ismail, for his advice. I'll be ignorant if I don't get a thorough lecture, and I
won't be able to accomplish this homework on time. I'd want to express my gratitude to
University Technology Mara (UiTM) Kota Bharu for providing me with the opportunity to
study Futures and Options this semester.
This subject has assisted me in broadening my abilities and knowledge, which will be
beneficial in the future. With this knowledge, I will be able to enter the trading industry.
Second, I'd like to express my gratitude to all of my friends who have helped me along the
way. Without everyone's help, I may not be able to do this homework on time.
3
INTRODUCTION
A contract is an arrangement to buy or sell a particular quantity of a specific asset at
a predetermined price on a specific date in the future. Futures contracts can be exchanged
on an exchange because the terms of each commodity or asset are standardised. The cost
is the sole variable. Futures contracts today reflect commodities and financial instruments
that you are familiar with from the news, such as oil, maize, gold, major stock indices, and
foreign currencies. Futures trading takes place on federally controlled exchanges, which
make it easier for buyers and sellers to trade and clear their positions. With each trade in
futures trading, the buyer and seller generate a new contract, with an unlimited number of
contracts possible. Each publicly traded and traded corporation, on the other hand, has a
restricted amount of shares of stock accessible for trading.
In this project, I employ two different sorts of future traders. The first is FCPO, which
stands for Crude Palm Oil Futures. FCPO uses a Ringgit Malaysia 'MYR' denominated
Crude Palm Oil Futures Contract to provide market participants with a global price
benchmark for the Crude Palm Oil Market, which is traded on Bursa Malaysia Derivatives
'BMD'. FCPO is widely utilised as a risk management tool in the edible oils and fats
business, as well as by fund managers and financial institutions to handle market price
changes. FCPO is a structured product that allows ordinary investors to participate in the
Crude Palm Oil market. For an optimistic outlook on Crude Palm Oil price movement, buy
low and sell high, and vice versa for a negative outlook.
FKLI-FTSE Bursa Malaysia KLCI Futures is the second futures trade. FKLI uses a
Ringgit Malaysia 'MYR' denominated FTSE Bursa Malaysia Kuala Lumpur Composite Index
(FBM KLCI) Futures Contract traded on the Bursa Malaysia Derivatives 'BMD' exchange to
provide market participants with exposure to the underlying FBM KLCI constituents. It is
actively employed in the trading portfolios of both institutional and retail investors.
4
TECHNICAL ANALYSIS
i) VOLUME
Technical analysis is the technique trading strategy that I use to be more effective.
Volume is the indication that I use in my trade. Volume refers to the number of shares of
stock that are traded on a securities exchange or bourse in a given day. Volume is a
prominent indicator that is usually shown in coloured columns, with green representing up
volume and red representing down volume. Volume is vital to include in a trading plan
because it verifies trend direction.
5
ii) Moving Average Convergence Divergence (MACD)
The moving average convergence divergence (MACD) indicator is a trend-following
momentum indicator that depicts the relationship between two moving averages of a
security's price. By subtracting the 26-period exponential moving average (EMA) from
the 12-period EMA, the MACD is calculated. The MACD indicator can help an investor
determine whether a bullish or bearish price movement is strengthening or weakening.
The different between the MACD line and the signal line is represented by the histogram
for this indicator. When the MACD line (coloured blue) crosses and goes about the
signal line (coloured orange), as seen in circles A below, it is time to sell. This suggests
that stock price are trending downward. When the MACD line crosses and travels below
the signal line, such as circle B it is time to buy. This suggests that stock price are
trending upward.
The indicator providing signals for buying and sells, may also be used to detect changes
in forthcoming trends by employing the MACD Divergence method. MACD Divergence
occurs when the high and low movements of the MACD line do not correspond to the
high and low movements of the stock price. MACD Divergence is classified into two
types which are bullish divergence and bearish divergence.
6
iii) Stochastic (RSI)
A Stochastic RSI may be discovered by evaluating a construing above 0.8 is deemed
overbought, while a reading below 0.2 is measured oversold. On the zero to 100 scale,
overhead 80 is overbought, while below 20 is oversold. Apart from this, we are employing
Stochastic RSI, which reveals Using RSI readings within the Stochastic formula gives
traders a sense of whether the current RSI value is overbought or oversold . Hence,
Stochastic RSI is suffering a downturn. Therefore the market indicates an overbought
condition. To summarise, the conditions suggesting selling signal to the futures contract
7
iv) Relative Strength Index (RSI)
The current strength index is a signal used in technical analysis that examines the
amount of recent price swings to determine excess in the price of a stock . The RSI is
shown a line graph that fluctuates between two extremes and can have a reading from 0
to 100. An RSI signal of 30 or below shows an oversold or undervalued state.
8
v) Moving Average
A moving average is also commonly used by investors in technical analysis to begin the
price analysis process. A moving average is a technique that is used to analyse data
points by constructing a series of averages in different subsets of the entire data set. It
is critical to employ the moving average indicator since it smooths out the price detail. In
their chart, the investor can use a single moving average or a variety of time frames.
Moving averages are fully indicator, meaning that while calculating an average, the
investor can choose any time period they desire. The most popular time ranges used in
moving average are 13,20,50, and 200 days. The more sensitive the average would be
if it was calculated over a shorter day range. Investors can select a time period of varied
lengths based on their trading objectives. For short-term trading, a shorter moving
average, such as 13 days, is commonly used.
9
FUNDAMENTAL ANALYSIS
FA 1
Tittle :Oil Palm Plantation in dire need of workers
Source :https://www.thestar.com.my
Date :Monday, 25 October 2021
News Contents
This news mention that an acute foreign labour shortage in Sabah’s oil palm plantation has
led to planters seeking government invention to reopen borders to get their workers back.
“There is an estimated shortage of around 10,000 workers,” said East Malaysian Planters
Association (EMPA) president HanasHakmad, adding that losses were around 10% to 15%
annually.
All plantation, whether the big ones or the smallholders, have been severely affected.
10
FA 1
Tittle :Parliament – Oil palm Plantations: Malaysia awaits consideration from source
countries for foreign workers
Source :The Edge Market
Date :Tuesday, 07 December 2021
News Contents
This news mention that Malaysia is now awaiting consideration from source countries,
namely Indonesia, in relation to the mechanism to bring in foreign workers for the oil palm
plantation sector, said the Ministry of Plantation Industries and Commodities (MPIC).
Deputy Ministry I Datuk Seri Dr Wee Jeck Seng said, based on discussions with the
Indonesian government recently, the ministry found that the republic is still considering to
send its workers to Malaysia even though it had previously agreed to do so.
This news also mention that the average price of crude palm oil of RM4,555 per tonne, the
loss due to the shortage of employment in August 2021 would amount to RM14 billion per
year. The estimated loss increased 56% and more than 100% compared with 2020 and
2019, whereby loss from the shortage of employment for these years were estimated at RM9
billion and RM6 billion respectively.
11
EXPERT OPTIONS
1
12
CONCLUSION
TRADING PLAN CHART
Trading Plan 1
Position :Short
Data Entry :FCPO DEC 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 2
Position :Short
Data Entry :FCPO JAN 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 3
Position :Short
Data Entry :FCPO FEB 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
13
TRADING PLAN CHART
Trading Plan 4
Position :Short
Data Entry :FCPO MAR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 5
Position :Short
Data Entry :FCPO MAR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 6
Position :Short
Data Entry :FCPO FEB 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
14
TRADING PLAN CHART
Trading Plan 7
Position :Short
Data Entry :FCPO JAN 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 8
Position :Short
Data Entry :FCPO APR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 9
Position :Short
Data Entry :FCPO DEC 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
15
TRADING PLAN CHART
Trading Plan 10
Position :Short
Data Entry :FCPO DEC 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 11
Position :Short
Data Entry :FCPO JAN 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 12
Position :Short
Data Entry :FCPO FEB 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
16
TRADING PLAN CHART
Trading Plan 13
Position :Short
Data Entry :FCPO MAR 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 14
Position :Short
Data Entry :FCPO APR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 15
Position :Short
Data Entry :FCPO JAN 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
17
TRADING PLAN CHART
Trading Plan 16
Position :Short
Data Entry :FCPO FEB 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 17
Position :Short
Data Entry :FCPO MAR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 18
Position :Short
Data Entry :FCPO APR 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
18
TRADING PLAN CHART
Trading Plan 19
Position :Short
Data Entry :FCPO JAN 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 20
Position :Short
Data Entry :FCPO FEB 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 21
Position :Short
Data Entry :FCPO MAR 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
19
TRADING PLAN CHART
Trading Plan 22
Position :Short
Data Entry :FCPO APR 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 23
Position :Short
Data Entry :FCPO APR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 24
Position :Short
Data Entry :FCPO MAR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
20
TRADING PLAN CHART
Trading Plan 25
Position :Short
Data Entry :FCPO FEB 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 26
Position :Short
Data Entry :FCPO JAN 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 27
Position :Short
Data Entry :FKLI DEC 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
21
TRADING PLAN CHART
Trading Plan 28
Position :Short
Data Entry :FKLI MAR 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis : From
that Chart, I gain of the profit
because I draw the support
and resistance line correctly.
Expert opinion :-
Trading Plan 29
Position :Short
Data Entry :FKLI JUN 2022
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
Trading Plan 30
Position :Short
Data Entry :FCPO DEC 2021
Technical :
1. Time Frame : 15
minutes
2. Major Treat : Bullish
3. Indicator : Volume,
Stochastic RSI, Moving
Average (MA)
Fundamental analysis :I have
the profit because I discipline
in the time when to buy and
sell it. Adapt it to needs and
capture my attention.
Expert opinion :-
22
REFERENCES
1. https://www.thestar.com.my/news/nation/2021/10/25/oil-palm-plantations-in-dire-
need-of-workers
2. https://www.theedgemarkets.com/article/oil-palm-plantations-malaysia-awaits-
consideration-source-countries-foreign-workers
3. https://www.tradingview.com/chart/
4. https://www.bursamarketplace.com/mkt/mygames/game/10708
23
APPENDICES
24
25
26
