Ad Practitioners, LLC This is commodities trading. What I can't understand is how those scribbled pieces of paper actually obligate people to honor this "contract" months down the road. That was the fricken best explination ever. In English that means that the person A is promising to buy and seller B is promising to sell 3,000,000 pounds of orange solids at $1.45 per pound due in April (a $4,350,000 transaction). ... Trading Places is the greatest Wall Street movie ever made. I just watched the movie again for the umpteenth time, and your explanation moved me closer to understanding the deal than any of the others. Opinions are our own, but compensation and in-depth research determine where and how companies may appear. At the same time, the Duke brothers purchase enormous quantities of FCOJ futures, even at relatively high prices, because they incorrectly expect that the crop report (falsely suggesting a greater need for stockpiled orange juice) will create a demand at even higher prices, securing them a profit. How do I make an exchange with Trading Places? wouldnt they make more money if they bought the commodity at the following trading day where the price is at its lowest? Opinions expressed on this site are the author's alone, not those of a third-party entity, and have not been reviewed, approved, or otherwise endorsed. ... Lots of stuff in Trading Places, including insider trading, is illegal. OTOH, I'm not sure who'd have talked as Billy/Louis were beyond extradition, Beeks wouldn't be made available for at least a few weeks, and the Duke brothers weren't going to volunteer information. Thanks a LOT! Looking to watch Trading Places? ‘He has also recently turned commentator on India's business and economic scene and indeed social and political arenas.’ ‘In the tough, macho arena of rock climbing, one woman has beaten the boys at their own game.’ ‘He did not seek to enter the political arena which is where you would seek to place him, with all its attendant risks.’ I just said "ohhhhhhhhh!" out loud so hard while reading your second paragraph. That means that in the example they made $90,000 on their first trade and $3,480,000 on their last. I mean why did they start buying knowing the price is continuously going down? I couldn't get my head around that. Now there are two ways that the contract can be satisfied- deliver 3,000,000 pounds of oranges OR buy another contract for 3,000,000 pounds of oranges at a different (preferable lower price). However, it seems likely that Billy Ray and Lewis were trading on margin, since that is the only way to turn $500k into F-U money for 5 people. The price of a commodity will be stopped if it ever fluctuates more than 10 cents (either direction) during one trading day. So now he has money to pay for the future debt--but he no longer owns the product. Where did I miss something? It was well past time to level the playing fields between races and classes. Though it is not stated in the movie exactly how much they make, if they invested roughly $500,000 from a combination of Winthorpe/Valentine's investment, the Duke's money from buying the "fake" report from a fake Clarence Beeks (Paul Gleason) and Coleman's and Ophelia's savings, they would have turned it into over $2.7 million. Ultimately the choice is yours. There are so many unforgettable moments. So we can think of their average buying price as $0.375. (He knows it will because he’s read the report.). 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