Friday, February 11, 2011

An Update on Our Rough Rice Futures Trade

We've seen a lot of mustard on the price action in rough rice since we initiated our long May 2011 futures position - but for all that, we are just about where we started:

Rough Rice Chart Futures Trade February 2011

Which, actually, is perfectly fine with me.  Since I generally use a 15-day low as my stop on these trades, a week or two of sideways trading is great, because it raises the stop - and hence, lowers the risk on the trade.

When entering this trade at the beginning of the month, we really had to use 13.50 cents as the stop.  After a couple weeks of sideways action, we can raise that up to around 15.00, or even 15.50.
Rough Rice Chart February 2011Source:

For the fundamental reasons and motivation behind this trade, see the article I wrote for Hard Assets Investor: Why We're Setting Up For a Rally in Rice.

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