Short explainer (spoken) about institutional market participants: three main institutional operator types are described—banks that hedge and rebalance portfolios, speculative institutions that accumulate to push prices higher, and commercial traders who use futures to hedge price imbalances. The speaker frames these categories to explain motivations behind institutional buying/selling activity.
There's like three major types of traders or operators from an institutional standpoint. You have institutions like banks that are hedging. They're long in one, short in another. So they're constantly hedging their, their portfolios. So they're buying and selling for those reasons, rebalancing, all that type of stuff. Then you have institutions who actually speculate. They'll accumulate and then they'll move to higher prices. Accumulate, move to higher prices. You have the speculators that are doing the same thing in a different way. And then you have the commercial traders who need to buy the futures contracts. In this case, they need the futures to hedge price imbalance.
