WASHINGTON, Aug. 2 (Xinhua) -- Data from U.S. Commodity Futures Trading Commission (CFTC) on Friday showed that market speculators held a net short position of 11,823 soybean future contracts for the week ending July 30.
Market speculators are non-commercial investors.
Meanwhile, the commercial traders that were commonly treated as hedgers still held a net long position of 28,124 contracts.
Speculators and hedgers are different types of investors. Speculators try to make a profit from the assets' price volatility, whereas hedgers attempt to reduce or "hedge" the amount of risk created by price volatility during the holding period of the assets.
When investors "short-sell" certain financial assets such as currencies or commodities, they hold a bearish view on the asset and believe that it will decrease in price.
Besides, the market expected there would be more pressure on soybean price after the United States threatened to levy new tariffs on Chinese imports on Thursday.
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.
