Wool

What is Wool?

Wool is the coat of fleece shorn from the body of a sheep.

Uses of Wool

Wool once taken from the body of sheep can be woven and used on it’s own or in conjunction with other materials to create, but not limited to:

  • Socks 
  • Jumpers
  • Business suits 
  • Costumes
  • Upholstery 
  • Cloth
  • Blankets

Risks of Wool

With any product derived from the production of livestock there is always the inherent risk of the elements affecting the quality and quantity of the product. These can include, but not limited to:

  • Drought
  • Floods
  • Fires
  • Storms 
  • Disease

Like any futures contract, there is always the possibility that the underlying asset i.e. wool will move in the opposite direction to which you hold your contract. For example: you have taken a long position (expecting the price of wool to rise), if this were to happen and the wool fell in price, your long position in wool will decrease in value.

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