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Real-time Monetary Inflation (last 12 months): 2.5%
Normally at this time of year, seasonal cotton traders would be looking forward to peeling off a monthlong position in the July delivery that's proved to be a fairly reliable winner. A purchase in the second week of February ordinarily—that is, 80 percent of the time—turns a $1,150-per-contract profit. Or rather, turned a profit.
Last year, amid glut and wobbly consumer demand, the trade would have actually produced a $1,725 loss.
But cotton's back now. In a big way. Since Feb. 16, old crop cotton's climbed more than 6 cents a pound, which doesn't sound like much ‘til you consider a contract calls for delivery of 50,000 pounds. That translates to...
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Special Guest Trader
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Real-time Monetary Inflation (last 12 months): 2.6%
When the skies cleared on Sunday, many backyard grills in our cabin-fevered neighborhood were fired up for the first time this year. The perfume of sizzling beef and pork that wafted over our street got me thinking about this spring's prospects for meat.
A month ago, we regarded cattle's, um, bullishness ( "Is Meat A Hard Asset?") as positive for the iPath Dow Jones-UBS Livestock Subindex Total Return ETN (NYSE Arca: COW) that tracks live cattle and lean hog futures. The iPath note, then trading at $28.21, has risen 3.9 percent, as cattle's weighted backwardation trumped hogs' contango.
Live cattle comprise about 63 percent of COW's underlying...
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Special Guest Trader
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Views 54
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Real-time Monetary Inflation (last 12-months): 2.5%
This week, the short end of the yield spectrum ticked up and gold spreads widened to indicate an expectation of eventual tightening by the Federal Reserve. Like last week, though, the interest rate boost held an accompanying rally in commodity prices in check.
Key inflation markers for the week ending Thursday:
- Morning gold fixes in London ended 4.0 percent higher, averaging $1,124; spot COMEX settlements, averaging $1,130, finished with a 2.2 percent gain; daily COMEX volume averaged 180,200 contracts, while open interest rose 5.5 percent to an average 481,100 contracts.
- Three-month London gold lease rates rose 1 basis point (0.1 percent)
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Special Guest Trader
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Views 193
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Real-time Monetary Inflation (last 12 months): 2.3%
Earlier this week ( "Add Soft Wheat To Your Hard Asset List"), we noted bottoming action and bullish seasonality in Chicago wheat futures bolstering the price of the iPath Dow Jones-UBS Grains Subindex Total Return ETN (NYSE Arca: JJG).
The buoyancy in agricultural futures, however, is being leveraged by agribusiness firms, much as mining company stocks key off the price of gold. This tendency is clearly reflected when the price ratio of agribusiness stocks over agricultural futures is plotted. The price differential between the equity-based Market Vectors Agribusiness ETF (NYSE Arca: MOO) and the futures-holding PowerShares DB Agriculture Fund (NYSE...
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Special Guest Trader
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Brad Zigler began his career as a trader for ContiCommodity, the trading arm of a the world's largest privately held grain dealer. Prior to his current role as managing editor of Hard Assets Investor, Brad was head of marketing, research and education at Barclays Global Investors' iShares exchange-traded funds complex and at Pacific Exchange's (now NYSEArca)options market. Representing the Options Industry Council, Brad has twice addressed Congressional and Senate panels on risk management and derivatives. In addition to editing for the Corporate Communications Broadcast Network, the Journal of Indexes, and CRB Trader, Brad has written for Mutual Funds, Financial Planning, Financial Advisor, Futures, Registered Rep. and Ticker magazines as well as The Street.com and MarketWatch.com. Brad's also been a financial correspondent for European Press Network, North Bay Business Journal and a PBS/NPR affiliate.
Interested in commodities? Check out HardAssetsInvestor.com for:
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