The major stock exchanges for cotton trading are situated in New York, Bremen and Tokyo. The cotton price is subject to broad fluctuations, which quite often are due to the seasonal and climatic trend. 
Obviously the positive operating results of a spinning mill depend also on a careful and ″lucky″ purchase of the raw material. In this regard we would remind the practice of the purchase option of a ″future″, according to which during the validity of the option the buyer has right, but not the obligation, to turn the option into a ″cotton future″. In practice futures are contracts for the purchase or sale of goods to be delivered at long-term, but at a price established at the time of entering into the contract. There are two possible types of option:
- CALL, : in this case the buyer has the right to convert the option into a long-term
″future″”
- PUT: in this case the buyer has the right to turn the option into a short-term ″future″.
In New York since 1870 the NYCE® (New York Cotton Exchange) take place, which is the world’s leading market for the sale and purchase of cotton futures and options. It is a non-profit-making organisation which assists all segments of the cotton industry by providing the financial means needed for risk management.
