With stocks tanking and Facebook breaking the Nasdaq, we’ve been watching another market over the last few days… plain, boring old Wheat. In the last four days, it’s been anything but boring.
Category: Markets
18
May
2012
16
May
2012
Your Friendly Gold Public Service Announcement
Is gold a safe haven during times of uncertainty? We compared the recent decline in gold prices to the drop we saw during the (last) financial crisis. If you’re looking for a safe haven investment, gold might not be your best bet.
11
Apr
2012
How Low Can it Go?
Since the peak in mid-2008, natural gas has been playing an impressive game of limbo. Just when you thought it couldn’t go any lower, down it goes. The short side of this trade is doing well for now, but how much lower can prices go?
09
Apr
2012
Market Dynamics and CTA Performance – March 2012 Update
Two factors have received particular blame for making 2011 a difficult year for managed futures: the number of risk on/risk off days, and the correlation between markets. How have these forces played out so far in 2012?
30
Mar
2012
Long-only Commodity ETFs v. Futures- March 2012
Here’s our monthly look at how the various Commodity ETFs are stacking up against the commodities they are supposed to track. Futures trading is complicated, presents a risk of loss, and isn’t for everyone – especially since past market performance doesn’t necessarily indicate future results – but given the numbers, we’re left scratching our heads. We’ve yet to receive a good answer to the question: why invest in an ETF when you can just roll December contracts annually?
16
Mar
2012
Witches, Leprechauns, High Volume and other Mythical Concepts
Another visit to the pits today, another unique perspective. As it turns out, today is what was once known as a “witching” day- a day on which multiple contracts expired, specifically, stock options, stock index options, stock futures and stock futures options. In the past, witching days were significant because the markets were all closing at once, leading to higher volume and volatility. Today, the closes are more staggered, but even so, there’s a general expectation that one will see similar effects.
15
Mar
2012
If Bill Gates Were as Tall as His Money
The move in Apple’s stock over the past few years has been nothing short of unbelievable – going from $90 at the start of ’09 to near $600 today (566% gain), and from $400 just a short two and a half months ago (50% gain). The odds of a stock doing what Apple has just done would be on the order of 1 in a million or so according to standard statistical methods.
But here’s the thing – these types of outlier moves (both up and down) happen way more frequently than once every million times, highlighting one of the often forgotten aspects of the investment world, that financial matters are not normally distributed. That is, you can’t use normal statistical measures (even when using the actual outlier data…) to make observations about what may happen moving forward.
01
Mar
2012
Long-only Commodity ETFs v. Futures- February 2012
Time for our monthly look at how the long only commodity ETFs are performing versus simply holding the December futures contract and rolling annually…
29
Feb
2012
Thoughts on the Nasdaq Breaking 3000
There’s something about round numbers that gets investors riled up. Witness: tons of news around today about the Nasdaq topping 3000. We hate to rain on the parade, but that’s still nearly 42% below the all time high of 5132.52 it reached on 3/10/2000.
Don’t get us wrong, the up move of 137% from the lows in 2009 through now is impressive, and reaching its highest level in 11 years is great. Unfortunately, that still leaves us with the uncomfortable fact that those 11 years were all spent in drawdown.
