Saturday, June 28, 2008

Current Commodity Futures Positions - 6/29/08

A nice little week - good to be back in the win column. Things cooled off later in the week for me, mostly as wheat plummeted in late trading hours Friday morning. However cattle ended the week very strong, which was great to see.

My new policy of watching the charts, rather than my account, helped me keep my zen about me. I'd recommend this to anyone who feels a pit in your stomach watching big $$$ evaporate by the minute. Better to calculate your position sizes, then put the position on, and detach yourself from it.

On a personal note, I had set a stretch goal of doubling my account during the first half of the year. Then I would have the second half of the year to double it again, and if I came close, then poof - I'd have some degree of financial autonomy.

Unfortunately it didn't happen, though there were some very promising moments (esp. the rocket start early in the year). However can't complain at all about 38% YTD. I'm looking forward to the 2nd half of the year, as I think cattle, sugar, cotton, and coffee all have rally potential. That doesn't mean it will happen, but it's worth keeping an eye on and a toe in the water.

Open Positions
Date Position Qty Month/Yr Contract Strike Call/Put Entry Price Last Price Profit/Loss
06/17/08 Long 1 DEC 08 Cotton 82.20 81.15 ($525.00)
06/26/08 Long 1 SEP 08 Coffee 'C' 153.30 151.95 ($506.25)
05/08/08 Long 1 OCT 08 Live Cattle 105.350 112.400 $2,820.00
05/09/08 Long 1 OCT 08 Live Cattle 106.700 112.400 $2,280.00
06/16/08 Long 1 DEC 08 Live Cattle 112.750 114.900 $860.00
06/19/08 Long 1 FEB 09 Live Cattle 116.200 117.000 $320.00
06/18/08 Long 1 OCT 08 Sugar #11 12.88 12.78 ($112.00)
06/11/08 Long 1 SEP 08 Wheat 867 3/4 908 $2,012.50
Net Profit/Loss On Open Positions: $7,149.25

Account Balances
Current Cash Balance $85,663.00
Open Trade Equity $7,149.25
Total Equity $92,812.25
Long Option Value $0.00
Short Option Value $0.00
Net Liquidating Value $92,812.25

Cashed out: $15,000.00
Total value: $107,812.25

Weekly return: 2.9%
YTD return: 38.0%

***BTW, I usually "cash out" money just to pay for taxes, rent, and cheap beer. So total value is all pre-tax.


pdyount said...

Curious what your take is on Faber's 6-12 month commodity 'correction':

He is one of the guys I like to follow - I'd love to here a Rogers/Faber discussion about his.

I am guessing a few of the runaway sky high commodities may pull back just to create buying opportunities - i can't see this impacting beef beef and I will be curious to see if oil/energy has a serious correction in that time frame - only thing I can see bringing a long energy correction is price finally killing off all global demand enough to make up for oil depletion.

pdyount said...

One more thing -

I am curious if you have ever considered a strategy to play uranium in any way(?)

...or would the lack of futures trading keep you out of that area?

SugarHigh said...

Yeah I really like Faber also. My $0.02 is that while I don't necessarily agree, it's certainly a viable scenario and can't be dismissed.

So my plan is to continue to tread carefully, and basically watch the market closely - if the market tells me to get out, I'll get out until it tells me to get back in.

Jim Rogers always mentions that there will be corrections along the way. If posed with Faber's prediction, I imagine he'd agree that there will be corrections, as nothing goes straight up. But he's an admitted poor market timer (though I am skeptical of that - I think he's a great market time) and will say that there's no way to tell when a correction will happen, so he'll continue to hold his commodities and will be a buyer on any pullback opportunities.

Re: uranium - I kind of missed that boat on that, as I think the big opportunity was during the big initial run up. People such as Doug Casey really nailed that trade, and the way to do it was by buying high quality uranium miners, as you're right, not traded on the futures exchange, so that limits pure price speculation (hey - does that mean prices can rise without speculators driving them? :))

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