The new year began, and it did begin very well: +6,31% in January, energies and Lean Hogs have failed in the last week but altogether it is a very good start. The market remains very volatile but at the same time it seems that the periodical fluctuations are taking control from which we could benefit dearly.
As for the results we must take into consideration that this new year I will not trade with old crop grain futures and with hogs futures before June 2013 at all since these products were impaired due to the drought of 2012. This has limited my positions and with it the potential to gain profit but I would rather stay out of the market than take risks with products which do not have a clear seasonal fluctuation.
The good news of 2013 is that the big funds, long only funds are limiting their positions in raw materials. These are the ones that make seasonal more volatile or drastically reduce them by operating in one single direction. This departure occurred owing to the fact that the share market is reviving and in 2012 the results of their indices have been better (+4,7% SPX) than commodity (-7,62% GSCI). I am happy because we are going back to normal.
The month of February looks difficult. I still hope the energy market normalizes and I can finish in the positive again. I am shaping the portfolio in the most efficient way possible with regards to spreads with futures. The point is to find an equilibrium between risk and profit. I can assure you that it is not an easy task as these are products that very few trade with in this manner.
As always, should you need anything do not hesitate to call me or send me an e-mail.
— Gregory Placsintar
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THE RISK OF LOSS IN TRADING COMMODITIES CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. THE HIGH DEGREE OF LEVERAGE THAT IS OFTEN OBTAINABLE IN COMMODITY TRADING CAN WORK AGAINST YOU AS WELL AS FOR YOU. THE USE OF LEVERAGE CAN LEAD TO LARGE LOSSES AS WELL AS GAINS. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.