After 3 consecutive months of zero “risk on” or “risk off” days (per our definition), April finally added some to the tally – with 3 risk on days and 1 risk off day making for about 18% of the trading days in the risk on/risk off category. In this case, it took a horrible tragedy in Boston to cause a sufficiently large market sell-off, which then spurred 3 subsequent “risk on” days as the market erased those losses and continued to new highs.
Category: Markets
07
May
2013
Wheat Tour 2013
No, it’s not the most boring concert event of the summer – this year the CME decided to do some live-tweeting of the Kansas City Board of Trade wheat tour and posted pictures and analysis along the way. It always amazes us to see this side of grain trading in action. Despite all of the […]
06
May
2013
Asset Class Standings After New Stock Highs
With the S&P 500 breaking 1,600 for the first time ever last week and finally getting above those pesky 2007 highs, we decided to look at just how well everything else has done in comparison since all was well before the financial collapse, and see if any other asset classes are back above their 2007 (nominal) highs. Which asset class is leading the pack after 5+ years?
03
May
2013
Asset Class Scoreboard: April 2013
The numbers for April were good for managed futures… and for every other asset class we track that isn’t named “Commodities.” Almost as impressive as the gains for real estate and stocks was the nosedive taken by the commodity index. Is it time for asset allocators to start rethinking long-only commodity exposure?
02
May
2013
Long-Only Commodity ETFs vs Futures- April 2013
We’ve made no secret that we think Commodity ETFs are a poor choice for investors, and the underperformance of those ETFs compared to futures contracts in 2011 and 2012 bore that out. But so far, 2013 has not matched our expectations, with commodity ETFs ahead of the Dec futures performance through the end of April. We still expect them to underperform in the long run, but in the meantime, here’s how they have fared in 2013.
29
Apr
2013
That Damned… W?
If there’s one thing that bugs trend followers, it’s the “V-shaped” recovery, when a market experiences a sudden, sharp reversal. Several markets that seemed to be on nice downtrends lately have exhibited this pattern over the last few days, while others have sported more of a W-shape. It may not seem like much, but the distinction can make a big difference.
19
Apr
2013
Copper Headed for the Floor
We’ve enjoyed watching the recent selloff in copper. It’s been one of the best trades of 2013 for trend followers. Unfortunately, the party might be coming to a grinding halt soon. With copper prices nearing the cost of production, it doesn’t look like this trend has very much room left to run.
12
Apr
2013
Smiling While Gold Sinks
If you’re a long-term trend follower, this is exactly the kind of move you like to see. The down trend in gold got started last year and – despite a few hiccups along the way – kept moving lower and lower over the until… well, anyone who took Goldman Sachs’ advice earlier this week to short gold is certainly smiling today.
08
Apr
2013
Asset Class Scoreboard: March 2013
The data for March is in, which means we can update our asset class scoreboard to reflect the first quarter of 2013. As it turns out, March was a fantastic month for investors nearly irrespective of where investors had their money (at least, according to our proxies for the various asset classes).
04
Apr
2013
Commodity “Supercycle” Not So Super
There’s a reason why we prefer managed futures – which can go long or short various commodity markets – to long-only commodity positions. In addition to our misgivings about the vehicles many investors use to gain commodity exposure, there’s another big problem: there’s no guarantee that commodity prices are going to rise.
