Options Strategy Evaluation Tool

1) asr: Esignal, IB data feed is supported , so you get full range of "Commodity futures" to test ( backtest ) and follow realtime model?



http://www.hoadley.net/options/develtoolsaddin.htm#quotes

The add-in includes several components for retrieving on-line quotes and option chains:
Quotes from Yahoo

About Peter Hoadley

2) Background

I spent twenty eight years in the IT and management consulting industries in a variety of roles: software developer, systems designer, IT consultant, and manager
I left the workforce in 1998 to focus full time on private investment activities. An active equities investor since 1996 I started developing options software in 1998. I started this web site in 1999.

Objectives

My focus is on providing high quality software for the private investor at a very low (or free) price, and for corporations at a competitive price.


3) asr: at $100 (one time fee) , this is very cheap for somebody who wanted to master Option strategies ..

Why is the Add-in so inexpensive compared with other products?
http://www.hoadley.net/options/develtoolsFAQs.htm#whyinexpensive

Different business models.



With a price of around 1/10th that of the product's closest competitor the private-use/non-commercial license is extremely inexpensive. The add-in's quality, however, no matter how you want to measure it --range and accuracy of functions, execution speed, consistency of approach across functions, documentation, working examples, email support -- is of the highest orde

Hedge Funds Lost $25 Billion Through Redemptions in February

By Tomoko Yamazaki

March 19 (Bloomberg) -- Investors pulled out a total of $25 billion from hedge funds in February, the seventh consecutive month of redemptions, as stocks worldwide tumbled amid signs a global recession is deepening, an industry report shows.

Total hedge-fund assets stood at $1.36 trillion at the end of February, down about $600 billion from their peak in June 2008, according to a monthly asset flow report by Eurekahedge Pte. In January, final net withdrawals totaled $95 billion, according to the Singapore-based research firm. The February figures are based on 71 percent of the funds reporting the month’s performances as of March 16, the report said.

“The industry has gotten smaller on both a regional and global basis and at this point, those still invested in hedge funds are by-and-large professional investors who are focused on the industry for the long term,” said Rory Kennedy, chief operating officer of United Managers Japan Inc., a Tokyo-based hedge fund adviser. They “will benefit as such from the uncorrelated returns that the less-crowded space can now deliver.”

The Eurekahedge Hedge Fund Index tracking more than 2,000 funds worldwide lost 0.8 percent last month, the report shows. The loss compared with a 10 percent slide in the MSCI World Index, which tracks stocks in 23 developed nations, and a 3.5 percent decline by the Reuters Jefferies CRB Index, a benchmark for commodities.

More Redemptions

In February, investors allocated $4.7 billion to hedge funds, mostly private pools of capital whose managers participate substantially in the profits from their speculation on whether the price of assets will rise or fall, the report said. The funds lost $11.5 billion through market losses, while they made $7.1 billion through market gains, Eurekahedge said.

“We continue to expect net redemptions over the next few months, especially out of funds with lock-ups expiring towards the end of the first quarter, and those that had either suspended or gated their redemptions over recent months,” Eurekahedge said in the report.

A record number of funds, including Citadel Investment Group LLC and Fortress Investment Group LLC, limited client withdrawals last year, angering investors who wanted to exit as the industry produced its worst annual performance on record.

Citadel, the $13 billion hedge-fund firm run by Kenneth Griffin, will decide each quarter whether to make payments from its two largest funds, Griffin, 40, said in an investor letter in February. Clients will be notified of any amounts available for redemption.

Eurekahedge released its preliminary report last week. Final figures for February performances and asset flows will be out next month.

To contact the reporter on this story: Tomoko Yamazaki in Tokyo at tyamazaki@bloomberg.net
Last Updated: March 18, 2009 21:03 EDT

Federal reserve buys Tresurys and bad loans

Fed not distracted by circus over bonuses
Commentary: FOMC ramps up credit easing in face of worsening economy
By MarketWatch
Last update: 2:48 p.m. EDT March 18, 2009
Comments: 893
WASHINGTON (MarketWatch) -- The grownups in Washington aren't about to let the latest political and media circus over ill-gotten bonuses distract them from saving this economy.
The Federal Open Market Committee acted very boldly Wednesday, promising to crank up the money supply until the economy starts breathing on its own again.
The FOMC said it would buy up to $300 billion in longer-term Treasurys over the next six months. And it said it would boost its purchases of mortgage-backed securities and agency debt, all in a bid to get credit flowing through the economy again. See full story.
All told, the FOMC committed to boost its arsenal by $1.15 trillion, doubling in one pen stroke the amount of "credit easing" it's already accomplished.
The Fed's move should lower interest rates for most borrowers, especially for homeowners and for businesses. Another wave of refinancings should help millions of homeowners lower their monthly payments.
Why would the Fed want to push more money into the economy? Simply, the outlook for the economy has deteriorated since January. The committee no longer expects a recovery later this year; at least, it's not willing to put that guess into its post-meeting statement.
Still, the Fed thinks that the most likely outcome is a "gradual resumption of weak growth." Somehow, the stock market has found some solace in that tepid endorsement.
The global economy is slumping and the U.S. economy is weak.
It's no time for half measures, or grandstanding about how unfair it is that a few hundred people are getting bonuses.
----------------
Stocks Close Higher; Fed's Tsy-Buying Plan Helps
By Rob Curran
Last update: 5:25 p.m. EDT March 18, 2009
Comments: 30
(Updates with company information, beginning on the tenth paragraph.)
NEW YORK (MarketWatch) -- The Federal Reserve has resorted to the printing press, and stock traders hailed the move with a rally.
The Federal Reserve's decision to bring down interest rates by buying long-term Treasurys and more mortgage securities helped financial institutions such as American International Group and Bank of America, giving the Dow Jones Industrial Average a more than 90 point gain.
Shortly after 2:15 p.m. EDT, the Federal Reserve said it will buy up to $300 billion in longer-term Treasurys and raise the size of lending programs already aimed at reducing mortgage rates by another $750 billion. The commitment to buy Treasury securities and additional mortgage-related debt should mean lower rates for a variety of business and consumer loans.
By buying Treasurys, the Federal Reserve is increasing the amount of money in the system in a similar fashion to cutting interest rates. That likely means another decrease in mortgage rates and more favorable rate spreads for banks. Banks will now be able to borrow money more cheaply, leaving more room for a profit. Also, the value of "toxic" mortgage securities will likely benefit from the Fed's purchases in that market.
"It's basically the next best thing" to a rate cut, said Dan Cook, senior market analyst at IG Markets. "Bernanke, in 2002, laid out this exact scenario almost word for word," he added, referring to a speech in which current Fed Chairman Ben Bernanke advocated use of the "printing press" to fight deflation.
Longer term, Cook said, "this debt is [going to be] tough to service after a while. I didn't hear about an exit plan."
Citigroup, the leading gainer on the Dow, added 57 cents, or 23%, to 3.08, and has now more than tripled in value since its low in early March. Still, Citi is off nearly 90% from this time last year. And, traders say, some of its recent gains were the result of an arbitrage strategy involving new preferred shares and existing common shares backfiring.
Among other banks, Bank of America added 1.40, or 22%, to 7.67, its highest level since January. Wells Fargo added 2.56, or 17%, to 17.22.
Hudson City Bancorp (Nasdaq) added 1.23, or 11%, to 12.02 after the New Jersey bank said it would require no help from the government and dubbed analysts' estimates for the quarter "reasonable."
Life insurers, whose shares were pressured by fears about their portfolios of mortgage-linked securities and stocks, bounced. MetLife added 4.37, or 21%, to 25.56; Hartford Financial Services Group rose 1.73, or 24%, to 8.86.
Shares of government-controlled insurer AIG, which also has large exposure to mortgage securities, surged 42 cents, or 44%, to 1.38, and has more than tripled from its low.
Overall, the Dow rose 90.88 points, or 1.23%, to 7486.58, its highest close in a month. The S&P 500 added 16.23, or 2.09%, to 794.35, after ticking above the psychologically significant 800 level during the session for the first time since Feb. 17. The technology-oriented Nasdaq Composite rose 29.11, or 1.99%, to 1491.22, helped by a reported bid from Dow component International Business Machines to buy Nasdaq component Sun Microsystems.

Energy market brokers

Now, “the probabilities are overwhelming that they will not cut,” Edward Morse, an economist at New York-based LCM Commodities LLC, said in a March 13 Bloomberg television interview. “If oil prices were at $40 or in the $30 range, I think it would be a fairly high probability they’d cut. With prices above $40, flirting with $50, they have the economy on their minds.”

asr: with bloomberg TV interview , see the LCM it is high profile firm with worlds leading oil companies and hedge funds as clients so they carry lots of valuble info. It is good to subscribe to bloomberg TV to get this info .
Look at CNBC , they got Excel partners ( I talked ) a small one man trading house to show the opinion .
find out March 13 interview time, if it is before 12 noon , the friday it is great info. to take short position. If it is after drop on friday say 1 pm it is already dropped.

Gold

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The big bond sales in part spurred a sharp spike in the price of gold to above $1000-an-ounce. Shares in SPDR Gold Trust (NYSEArca: GLD) were rising 1.2% in pre-market trading to 98.70.

Technical traders in Asia are recommending shorting the gold price when it breaches the $1000-an-ounce level, however.

In a weekly technical research note which correctly predicted Tuesday’s jump over the benchmark level, Martin Marnick, a director at Hong Kong-based Helmsman Global Trading, tells the firm’s hedge fund clients to take advantage of a temporary bump in prices.

“Sell and short above a 1000. A quick pullback below 940 [will ensue] before November, which then recovers,” wrote Marnick.
( this analyst said it on 9/8/09 )

asr note: see MCRI gold seasonal chart it shows seasonal exit 9/21 and DROP in price next 1 month. see it is confirmed by above recommendation.
- one good strategy may be selling expensive OPTIONS at 1050 level of GOLD price

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Consider the Hulbert Gold Newsletter Sentiment Index (HGNSI), which reflects the average recommended gold market exposure among a subset of short-term gold timing newsletters tracked by the Hulbert Financial Digest. As of Monday night, the HGNSI stood at 36.8%.

How do the investment newsletters I monitor recommend that you take advantage of any gold rally?

Exchange-traded funds (ETFs) are far and away the most popular investment instrument. Currently, for example, no fewer than 16 of the newsletters I track are recommending the SPDR Gold Trust) , each of which is currently recommended by six newsletters.

API Report Change Heightens Trader Curiosity

this article is dated 27 Jan 2009 , so API reporting time change effective from this date.

asr: basically we have API (industry consortium ) , EIA (govt.) and we have
Bloomberg/Reuters avarage analyst expected numbers
McGraw Hill energy service agency expected numbers

Starting this week, the American Petroleum Institute's (API)weekly statistics will be released on inventory Tuesdays at 4:30 p.m. ET. The U.S. Energy Information Administration's (EIA)petroleum report will come out Wednesdays at 10:30 a.m. ET. An API spokeswoman says the move was made to prevent the API data from impacting trading. However, electronic trading on CME Globex runs until 5:15 p.m. ET, restarts again at 6 p.m. and runs through the night.

Releasing the API numbers after the floor session ends may dull the dramatic, knee-jerk reaction we often see after the data comes out on Wednesday morning. Yet, to the extent that traders hold much faith in the government's weekly oil supply reports, even fewer traders appear to follow the API data very closely. Many traders tell me they are skeptical of the industry's data because a company's participation is voluntary. They believe the government's data seems more credible.

Still, a number of veterans of the NYMEX floor said they'll be at their computers this afternoon, waiting for the API numbers. For now, the initial time change has heightened their curiosity.

Oil: Squandered opportunities

Traders are seasick from the oil markets lately; the volatility has been so extreme. Aside from the obvious macro-factors, what else is driving the abnormally large swings in crude oil?

It's called "contango." Contango occurs when futures prices are higher than current prices. The scenarios are not uncommon, but the recent spread widths are extreme by any measure.

For example: the April 2009 crude oil contract is around $38.10 -- while the April 2010 crude contract, crude for delivery a year from now, is trading at $50.26. That's a $12.16 spread.
That means major oil companies like Royal Dutch Shell can store oil on tankers and then sell the April 2010 contract at $50.26.

Even factoring in the cost of storage, they come out better selling forward than selling at current market prices. This maneuvering causes additional volatility throughout the oil curve, as physical oil companies position themselves in the futures markets to take advantage.

Contract rolls
Another strategy we see consistently in the energy market is contract rolls at major hedge funds, commodity-trading advisers and exchange-traded funds. One ETF is the U.S. Oil Fund LP (USO:USO 25.39, +0.91, +3.7%) , the world's largest oil fund, said to account for 22% of the outstanding front-month contracts each month.

When the front-month contract approaches expiration, this gigantic ETF must sell its position in the expiring month and buy it back for the coming month.

Also, long-term trends following CTAs and hedge funds have been short on the front months. When a contract expiration approaches, the fund has to roll its short position into the next month's contract, since most CTAs and hedge funds have neither the ability nor the interest to take physical delivery of oil.

The volatility in energy is due to the gigantic tug of war going on around key days of the month where funds, ETFs and oil companies are adjusting for the roll.

Oil producers running out of storage space

Many oil tankers are little more than floating storage facilities now


Glut caused by world slowdown leaves the world awash in crude
So oil companies and investors are stashing crude, waiting for demand to rise and the bear market to end so they can turn a profit later.

Meanwhile, oil-producing countries such as Iran have pumped millions of barrels of their own crude into idle tankers, effectively taking crude off the market to halt declining prices that are devastating their economies.

Traders have always played a game of store and sell, bringing oil to market when it can fetch the best price. They say this time is different because of how fast the bottom fell out of the oil market.

"Nobody expected this," said Antoine Halff, an analyst with Newedge. "The majority of people out there thought the market would keep rising to $200, even $250, a barrel. They were tripping over each other to pick a higher forecast."

Now the strategy is storage. Anyone who can buy cheap oil and store it might be able to sell it at a premium later, when the global economy ramps up again.

The oil tanks that surrounded Cushing, Okla., in a sprawling network that holds 10 percent of the nation's oil, have been swelling for months. Exactly how close they are to full is a closely guarded secret, but analysts who cover the industry say Cushing is approaching capacity.

It's the same scene at the four other massive storage sites in the U.S., complexes on the East Coast, Gulf Coast, West Coast and near the Rocky Mountains.

Gas demand drops
Some oil is ending up in giant ships and staying there. On supertankers rented by oil companies such as Royal Dutch Shell, there is little for crews to do but paint and repaint the decks to pass time.

More than 30 tankers, each with the ability to move 2 million barrels of oil from port to port, now serve as little more than floating storage tanks. They are moored across the globe, from the Texas coast to the calm waters off Europe and Nigeria.

"It gets expensive to do this," said Phil Flynn, an analyst at Alaron Trading Corp. "If you're sitting on a bunch of oil and you're stuck paying storage and insurance, and you can't find a buyer, you may have to sell it at a discount just to get rid of it."

On the other hand, as storage units on land have filled up, the companies that own the tankers have profited. Tanker companies charge an average of $75,000 a day, three times as much as last summer, to hold crude, said Douglas Mavrinac, an analyst with Jefferies & Co.

Demand for oil began to increase steadily in the early 1980s, and it went into overdrive in recent years as the Chinese economy surged. That changed when recession gripped the globe, and frozen credit markets made things worse. Inventories swelled.

Refineries in the U.S. have cut way back on production of gas as the economy weakens and millions of Americans, many of them laid off, keep their cars in the garage.

The latest government records show U.S. inventories are bloated with a virtual sea of surplus crude, enough to fuel 15 million cars for a year. Inventories have grown by 26 million barrels since the beginning of the year alone. Oil from Saudi Arabia, the United Arab Emirates and Nigeria is finding few takers, even though much of it is used to make gasoline in the United States.

There are so many players in the international oil market that no one has enough control to sway prices. OPEC slashed production by more than 4 million barrels a day, and still the price of a barrel of crude languishes near $40. At its peak, it traded at $147 a barrel.

Experts aren't sure what will happen when it all that oil finally comes ashore.


One fear is that with oil prices so low, companies will slash drilling and production, setting the world up for an energy crunch that would send prices soaring. The number of oil and gas rigs operating in the United States has fallen a staggering 39 percent since August.

Others say prices would plummet if companies forced millions of barrels onto the market at once.

"If everyone's running for the exits at the same time, they'll engineer a price collapse," Flynn said