http://ezinearticles.com/?My-Experiences-Trading-Soybeans,-Soymeal-and-Soybean-Oil-Commodity-Futures-Contracts-and-Options&id=493334
Soybeans are king of the speculative trading "soy" complex. The complex includes soybeans, soymeal and soybean oil. Soymeal is used primarily as feed. Poultry and cattle producers use the majority of soymeal. The majority of soybean oil is used for cooking and salad oil.
For about $1200 of account margin you can control a 5,000 bushel contract of Soybeans worth about $35,000. A 10 cent move equals $500. (example: a move from 750 to 760)
For about $600 you can control 60,000 pounds of soybean oil worth about $16,000. A $1 move equals $600. (example: 28 to 29)
For about $900 you can control 100 tons of soymeal worth about $20,000. A full 10 point move equals $1000. (example: 210 to 220)
As you can see, you are permitted the privilege of tremendous leverage. There is great potential for both profit or loss if you choose to use it. Bear in mind you are NOT required to use leverage and may deposit all or any part of the contact's value into your account. For example, if you maintain $35,000 in your account for one contract of soybeans, you have 100% of the soybean contract covered and essentially are not trading on leverage
Recently, soybean oil has attained notoriety as an alternative fuel source. (Bio-diesel) Similar attention goes to corn / ethanol fuels.
There is a trading strategy based on the processing of soybean products. It's called a "crush" spread. It works by buying one soybean contract; then sell one soybean oil and one soymeal contract. To profit, you want the soybean contract to gain on the soybean oil and meal contracts. A "spread" is the difference between the two legs.
There is also a "reverse crush" spread. You would sell one soybean contact; then buy one soybean oil contract and buy one soy meal contract. Notice that one soybean contract ($35,000) is worth roughly the same value as an oil and meal contract.($16,000 and $20,000) Thus, this is a reasonably balanced spread.
Soybeans, soybean oil and soymeal futures all tend to trend in the same direction but still have different patterns and habits. It's a good idea to buy the strongest of the three and sell the weakest of the three. One way to determine the strongest is to watch the chart's rising bottoms in an uptrend. Pick the commodity making the highest bottoms. You want the one with the most inclined stair step uptrend. This is the strongest of the group to buy. You can also see this evidence when comparing a sideways bottom formation between the three. Reverse this for analyzing a topping area to sell short.
For the serious trader, soybean complex futures and options are one of the top trading commodities. They have it all; liquidity, volume, open interest and great moves up and down. The charts show many classic patterns. Look for triangles, head and shoulders, breakouts, spikes and gaps. Soybeans can be a chartist's dream. Beans also exhibit regular seasonal and cyclic patterns to use as rough guidelines.
The soybean market often trends for long periods of time because it's based on a specific crop. In the last forty years, the lowest price was in 1968 at $2.38 a bushel. The all-time high is 1973 at $12.90.
The rallying cry of the bean bulls has been “Beans in the teens!" It may happen one day.
In the last five years, Brazil and Argentina have become big soybean producers. Their seasonal harvests are the reverse of the U.S. American traders need to keep an eye on our southern neighbor's production and growing seasons. Some say soybeans will never approach the old highs because of these new suppliers in the market. Never say never.
Of course, weather is a major market mover. During the summer, big moves can occur around monthly or weekly reports. Selling into these reports can be profitable. Fifty-cent limit moves ($2500) are not unusual when the market is rolling and a report comes out.
The soybean complex lends itself to all types of different strategies in options and futures. Spreads, straddles, strangles and synthetics are all good ways to trade when the forecast is high probability.
The CBOT has recently started trading electronically as well as overnight in a shortened session. At this time, all soybean complex options continue to be pit traded.
Wheat Futures and options are probably the most volatile of the grain group. Wheat can move very quickly. Wheat is better suited to an intermediate level commodity trader wanting quicker results and more risk. Wheat futures and options can trade counter to corn and soybeans. This is probably because rain is not as important to wheat as to corn and soybeans.
Over the last forty years, wheat has traded as low as $1.20 in the late 1960’s and as high as $7.50 in the mid 1990’s. One dollar a bushel moves can occur when the market is active. ($5,000) Hang on to your hat when trading wheat. There is an old trader's adage that goes, "Don't sell your wheat until it boils!" It's true that wheat has a tendency to end a bull campaign with fireworks and spike tops. Panic shortages are unique to commodities. Shortages rare in the stock market.
Good Trading!
There is substantial risk of loss trading futures and options and may not be suitable for all types of investors. Only risk capital should be used.
Thomas Cathey - 27-year trading veteran heads the managed futures division of Thomas Capital Management, LLC. View his market forecast TimeLine Trading charts and get his complete 44+ lesson, "Thomas Commodity Trading Course - all free." http://www.thomascapitalmanagement.com/commodity/welcome.htm Main site: http://www.ThomasCapitalManagement.com
Wednesday, June 17, 2009
Monday, June 15, 2009
Children Infants with Albinism
Children & Infants with Albinism
http://www.visionaustralia.org.au/info.aspx?page=672
With thanks to Dr James Elder, Ophthalmologist.
Albinism
Albinism is an inherited condition. It affects the eyes and skin of some individuals, and only the eyes of others. It results from the body's inability to produce normal amounts of a pigment called melanin.
Children with oculocutaneous albinism, where both the skin and eyes are affected, can present with varying degrees of pigment. Some children have white hair, little or no pigment in the skin, pale coloured eyes and significant vision impairment. Others with more pigment may have red-brown hair, some skin colour, blue or brown eyes and less severe vision impairment.
Children with ocular albinism have vision impairment but the hair and skin are normal or near-normal in colour.
Oculocutaneous Albinism
This type of albinism usually occurs as a result of autosomal recessive inheritance, where both parents carry one gene for albinism. Recessive inheritance is the result of receiving one defective gene from each parent.
All of our genes come in pairs and if one gene is normal and the other is defective, in a recessive disorder there will be no abnormality. In oculocutaneous albinism the parents, or carriers, usually have normal pigmentation and vision, but when a defective gene is inherited from each parent, the child will have a pair of defective genes and will develop the disease.
In recessive inheritance, there is a one-in-four chance with each pregnancy that the child will have albinism. Both boys and girls can be affected.
Ocular Albinism
This type of albinism can also be recessively inherited, with both boys and girls being affected and a one-in-four chance with each pregnancy.
Ocular albinism can also be X-linked, where the gene for albinism is passed on with the X-chromosome. X-linked diseases result from the difference in the chromosomes of men and women.
Men have an X and Y chromosome and women have two X chromosomes. A disease which is caused by a defective gene on the X chromosome is much more likely to affect men as the Y chromosome will not have a matching normal gene.
Women are carriers of X-linked diseases as, almost always, there will be a normal matching gene on the second X-chromosome. In this form of inheritance, there is a one-in-two chance that sons will have albinism.
Following the birth of a child with albinism, genetic counselling can provide parents with information regarding the risk of future children having albinism
http://www.visionaustralia.org.au/info.aspx?page=672
With thanks to Dr James Elder, Ophthalmologist.
Albinism
Albinism is an inherited condition. It affects the eyes and skin of some individuals, and only the eyes of others. It results from the body's inability to produce normal amounts of a pigment called melanin.
Children with oculocutaneous albinism, where both the skin and eyes are affected, can present with varying degrees of pigment. Some children have white hair, little or no pigment in the skin, pale coloured eyes and significant vision impairment. Others with more pigment may have red-brown hair, some skin colour, blue or brown eyes and less severe vision impairment.
Children with ocular albinism have vision impairment but the hair and skin are normal or near-normal in colour.
Oculocutaneous Albinism
This type of albinism usually occurs as a result of autosomal recessive inheritance, where both parents carry one gene for albinism. Recessive inheritance is the result of receiving one defective gene from each parent.
All of our genes come in pairs and if one gene is normal and the other is defective, in a recessive disorder there will be no abnormality. In oculocutaneous albinism the parents, or carriers, usually have normal pigmentation and vision, but when a defective gene is inherited from each parent, the child will have a pair of defective genes and will develop the disease.
In recessive inheritance, there is a one-in-four chance with each pregnancy that the child will have albinism. Both boys and girls can be affected.
Ocular Albinism
This type of albinism can also be recessively inherited, with both boys and girls being affected and a one-in-four chance with each pregnancy.
Ocular albinism can also be X-linked, where the gene for albinism is passed on with the X-chromosome. X-linked diseases result from the difference in the chromosomes of men and women.
Men have an X and Y chromosome and women have two X chromosomes. A disease which is caused by a defective gene on the X chromosome is much more likely to affect men as the Y chromosome will not have a matching normal gene.
Women are carriers of X-linked diseases as, almost always, there will be a normal matching gene on the second X-chromosome. In this form of inheritance, there is a one-in-two chance that sons will have albinism.
Following the birth of a child with albinism, genetic counselling can provide parents with information regarding the risk of future children having albinism
Tuesday, June 9, 2009
USDA report for agricultural commodities
asr: see this is good eductaion on USDA reports on Agri..
Summer Outlook For Commodities
Wednesday May 27, 2009
Most of the action in commodities during the summer takes place in the grain markets. This year should be no exception. Supplies are tight for soybeans and corn this year, so traders will be on edge while monitoring weather reports this season. Good weather and abundant crops this season might lead to a steady drop in prices, while adverse weather could send prices soaring. Either way, there should be good movement.
The USDA will release the final estimates for acres planted this season at the end of June. That will be a key report,
- along with the monthly crop reports that come out around the 10th of every month.
- However, the weekly crop progress reports on Mondays may be the most closely watched. They provide a weekly update as to the conditions of corn, soybeans, wheat and other commodities across the country. If crop conditions move well below their 5-year average, prices should move higher.
Other commodities have been very active coming into the summer season and there may be continued volatility into the summer. Coffee, sugar and cotton will be a few commodities to watch. Also, we’ll have to see if lean hogs can shake off the negative effects of the swine flu.
Summer is also hurricane season for commodities and traders are always on alert, even though this hurricane season is expected to be a tame one. Natural gas and crude oil come to mind for commodities to watch. Any major hurricanes moving into the Gulf of Mexico should cause some movement in these commodities. The chances are low for a major run higher, but you never know.
Summer Outlook For Commodities
Wednesday May 27, 2009
Most of the action in commodities during the summer takes place in the grain markets. This year should be no exception. Supplies are tight for soybeans and corn this year, so traders will be on edge while monitoring weather reports this season. Good weather and abundant crops this season might lead to a steady drop in prices, while adverse weather could send prices soaring. Either way, there should be good movement.
The USDA will release the final estimates for acres planted this season at the end of June. That will be a key report,
- along with the monthly crop reports that come out around the 10th of every month.
- However, the weekly crop progress reports on Mondays may be the most closely watched. They provide a weekly update as to the conditions of corn, soybeans, wheat and other commodities across the country. If crop conditions move well below their 5-year average, prices should move higher.
Other commodities have been very active coming into the summer season and there may be continued volatility into the summer. Coffee, sugar and cotton will be a few commodities to watch. Also, we’ll have to see if lean hogs can shake off the negative effects of the swine flu.
Summer is also hurricane season for commodities and traders are always on alert, even though this hurricane season is expected to be a tame one. Natural gas and crude oil come to mind for commodities to watch. Any major hurricanes moving into the Gulf of Mexico should cause some movement in these commodities. The chances are low for a major run higher, but you never know.
Top Reasons Why Commodity Traders Lose Money
What Is Unfair About Trading and What You Can Do About It
-- click on the presentation link to see the DRAWDOWN to RECOVER chart/Graph
asr: interesting at this presentation, author shows a tradeSetup with 'downward reversal' followed by ' 4 day up days' etc.. and tests on S&P 500 chart for '27 years' and gets result. it shows 90 trades over 27 years . It is intresting to Learn this SETUP for our OIL trading ...
http://www.traderinsight.com/Videos/Art/082509/082509.html
look at
http://www.tigersharktrading.com/articles/8140/1/The-Dave-Landry-Stock-Swing-Trading-Mini-Course/Page1.html
trading subscriptions : http://storesense2.megawebservers.com/HS2162/Categories.bok?category=Trading+Subscription
-----------------
Over Leveraged Commodity Trading
Over Leveraged Commodity Trading
Almost every small trader who ventures into commodities falls into this trap. There is huge leverage when trading commodity futures and a couple bad trades can wipeout the over leveraged trader. Fortunately, there is a simple rule you can follow to take care of this problem - do not risk your whole account on one trade. Also, do not trade a contract that is too large for your account size. For example, you shouldn’t trade three futures contracts that average a $2,000 move a day when you have a $10,000 account.
Money Management
Do not risk more than 5 percent on any one trade. Most professional money managers risk less than 2 percent on any one trade. This is tougher if you start trading commodities with only a $10,000 account. In this case you should risk no more $500 on a trade. If you want to risk no more than $500 on a trade, all you have to do is place a stop loss order $500 away from you entry. It doesn’t guarantee you won’t lose more than $500, but it is as close as you can get.
Commodity Trading Plan
I cannot stress enough how important it is to have a trading plan in place before you begin trading commodity futures. A trading plan is your guide to how you will control your trading. It should be in writing and reviewed regularly. The trading plan should include the markets you will trade, your trading strategy, money management and even a plan to stop trading for a period of time if your account equity drops to a certain level. Trading without a plan will lead to erratic an undisciplined trading, which ultimately leads to painful losses.
------
Commodity Trading Strategies
This is where many unsuccessful traders go wrong. They have no specific trading strategies for entering and exiting trades. The “wing-it” approach will not work. You might get lucky once in a while, but I can almost guarantee you will lose in the end. Watching the news for trading opportunities is not a trading strategy. You should have a logical and tested fundamental or technical strategy for trading commodities. Also, decide whether you want to be a long-term trader or a short-term trader.
----------
Nobody Makes money from Trading Commodities
The fact is that many people do lose when trading commodities. However, the losers are usually ill prepared investors who jump into the commodity markets and lose within six month, never to return again. Others get addicted to the markets, while trying again and again to make a killing with the same strategies and just keep losing.
The good new is that commodity investing is a zero sum game, which means for every dollar lost, someone gains a dollar. Actually, you have to factor in transaction costs, so each person loses a little more than a dollar and the other party gains a little less than a dollar.
So, who makes all the money? It is normally the professional commodity traders and money managers that consistently make money year after year. Also, amateur commodity traders who make money tend to trade for a long time – maybe 30 years. In that time, this trader has probably taken money from hundreds of commodity investors along the way.
Successful amateur traders and professional traders usually trade larger amounts of money. A professional trader managing $1 million may make profits of $200,000 for the year. In reality, he took money from the equivalent of 40 losing traders who threw $5,000 into the markets. Successful traders have usually paid their dues to learn how to trade commodities properly and they follow a strict trading discipline, which most losing traders never adopt.
Monday, June 1, 2009
VSA
VSA
asr: my screen shot
asr: author Todd Krueger is former CEO of traderguider ( see links at end )
- he seems this Former CEO started this site
http://www.traderscode.com/current-news.html
but generally speaking
- fundamental analysis is concerned with the question of why something in the market will happen,
- and technical analysis attempts to answer the question of when something will happen.
What is Volume Spread Analysis?
Volume spread analysis (VSA) seeks to establish the cause of price movements. The “cause” is quite simply the imbalance between supply and demand in the market, which is created by the activity of professional operators (smart money). Who are these professional operators?In any business where there is money involved and profits to make, there are professionals. There are professional car dealers, diamond merchants and art dealers as well as many others in unrelated industries. All of these professionals have one thing in mind; they need to make a profit from a price difference to stay in business. The financial markets are no different. Doctors are collectively known as professionals, but they specialize in certain areas of medicine; the financial markets have professionals that specialize in certain instruments as well: stocks, grains, forex, etc.
The activity of these professional operators, and more important, their true intentions, are clearly shown on a price chart if the trader knows how to read them. VSA looks at the interrelationship between three variables on the chart in order to determine the balance of supply and demand as well as the probable near term direction of the market.
These variables are
- the amount of volume on a price bar,
- the price spread or range of that bar (do not confuse this with the bid/ask spread), and the
- closing price on the spread of that bar
Why it Works
Every market moves on supply and demand: Supply from professional operators and demand from professional operators. If there is more buying than selling then the market will move up. If there is more selling than buying, the market will move down. Before anyone gets the impression that the markets are this easy to read, however, there is much more going on in the background than this simple logic. This is the important part of which most non-professional traders are unaware! The underlying principle stated above is correct; however, supply and demand actually work in the markets quite differently. For a market to trend up, there must be more buying than selling, but the buying is not the most important part of the equation as the price rises. For a true uptrend to take place, there has to be an absence of major selling (supply) hitting the market. Since there is no substantial selling to stop the up move, the market can continue up.
What most traders are completely unaware of is that the substantial buying has already taken place at lower levels as part of the accumulation phase. And the substantial buying from the professional operators actually appears on the chart as a down bar/s with a volume spike. VSA teaches that strength in a market is shown on down bars and weakness is shown on up bars. This is the opposite of what most traders think they know as the truth of the market. For a true downtrend to occur, there must be a lack of substantial buying (demand) to support the price. The only traders that can provide this level of buying are the professional operators, but they have sold at higher price levels earlier on the chart during the distribution phase of the market. The professional selling is shown on the price chart during an up bar/s with a volume spike, weakness appears on up bars. Since there is now very little buying occurring, the market continues to fall until the mark down phase is over. The professional operator buys into the selling that is almost always created by the release of bad news; this bad news will encourage the mass public (herd) to sell (almost always for a loss). This professional buying happens on down bars. This activity has been going on for well over 100 years, yet most retail traders have remained uninformed about it—until now.
----
Anyone know how to reach Todd Krueger, former CEO of TradeGuider?
http://www.traderslaboratory.com/forums/f53/volume-spread-analysis-tradeguider-1382.html
----------
asr: this was JUN/2009 post
http://www.traderji.com/advanced-trading-strategies/23128-volume-spread-analysis.html
The basic premise behind the volume spread analysis is that the market is basically moved by the “Smart Money”. The smart money accumulates the stocks at low prices. Then begins process of marking up the price. Then the “Dumb Money” starts entering the smart slowly. The smart money starts passing the ownership of the stocks to the dumb money. This process is called Distribution. Soon more and more dumb money starts rushing into the market not wanting to be left out of the big rally. Unfortunately the retail traders are the last to get in. Once the process of distribution is complete the smart money starts rapidly marking down the prices and the dumb money are left holding the stock which was bought at high prices. At the end the smart money is much richer and they can again start accumulating the stock at lower prices. The cycle continues.
This one way explains why the move moves are slow and the down moves are very rapid. The process of marking up the prices and distribution is a slow process. It takes some effort to get the dumb money interested in buying into the rally. The mark down process is very rapid as the smart money’s intention is to trap the dumb money. They have to give very little chances to dumb money which is generally slow in reacting to exit.
VSA attempts to read the moves of the smart money by looking at the price, volume and the spread of prices.
------------
First thing is of course to understand a little more about working of Smart Money (hereafter we will just use the term SM to indicate Smart money).
The SM basically moves the market in four phases as follows
1. Accumulation
2. Markup
3. Distribution
4. Mark Down
Most of you may be fully aware of these. Still we will look at these phases more in details as this would help us to understand the SM operation better which in turn would give a better perspective to VSA.
There will not be any demand for something when there is plenty of it available and nobody wants it. As the availability decreases and more people want it then the demand increases. So the first thing the SM does is find something that is available a plenty and cheap. The next step is to create a scarcity of the same and get people interested in it which in turn generates the demand. This is first phase which is Accumulation.
Accumulation is a process through which the SM acquires a large quantity of the stock at the lowest possible price. Accumulation is a subtle, sophisticated and sly process of cornering a huge quantity of the stock that makes the following phases possible and worthwhile. Once a large quantity has been absorbed the number of floating stock reduces and the demand increases. This makes possible the next phase Markup.
Accumulation normally takes place in congestion areas. Congestion area are mostly sideways range bound movements where the stock appears to have no interest to either move up or move down. The SM ensures that the stock is contained below a certain upper level which is the supply area. At the same time the SM also supports the prices above a certain lower line which is the support area. The stock moves within an upper resistance or supply area and a lower support area.
The congestion areas are characterized by Indecision. One of the most important characters of congestion areas is the Low Volume. When most traders are bullish or bearish the volume is high. Low volumes indicate indecision among the traders on bullishness and bearishness.
Ah.. Sounds easy…….. Well the problem is that congestion areas are seen in both accumulation areas as well as Distribution areas ……… oh , Well that is not the only problem………. There will be periods where no one seems to be interested in the stock… the pattern of price movement most of time very similar to the congestion pattern…..
So the naturally the question is how one would ascertain if the pattern is really accumulation in progress……. A little later on this and other congestion patterns…..
Tuesday, May 19, 2009
IEA: downturn sets up surge in oil prices
(From THE WALL STREET JOURNAL)
By Spencer Swartz
LONDON -- Energy investment is "plunging" because of the recession, paving the way for
oil-price surges within three years, the International Energy Agency warned in a new report.
The Paris-based watchdog for the world's major energy-consuming nations said that in recent
months, oil companies and investors have canceled or postponed about $170 billion of investment
equivalent to roughly two million barrels a day in future oil supply.
An additional 4.2 million barrels a day in future oil-supply capacity has been delayed by at
least 18 months as companies slash spending.
The study will be presented to energy ministers from the Group of Eight industrialized
nations this weekend in Rome and to G-8 leaders at a July summit.
The report highlights the growing risk that the crude supply -- though currently abundant
because of weak global consumption -- could tighten quickly once the world economy gets back on
its feet.
"What we're saying is that come around 2012 the impact of this big recession on oil
investment and capacity, if current trends continue, could be severe with much higher oil
prices," said IEA chief economist Fatih Birol. The IEA is funded by the world's 28 biggest
energy-consumers, notably the U.S. and Japan. It has long argued for more aggressive investment
in building oil capacity.
The report, which was reviewed by The Wall Street Journal, also notes that most delayed or
canceled projects are located in politically stable non-OPEC nations like Canada. Those
resources take more years to develop than crude oil found in the members of the Organization of
Petroleum Exporting Countries, which is typically easier and cheaper to get out of the ground.
The rate at which world oil demand recovers remains a critical -- and unknowable -- variable.
Several governments in the developed world are advancing energy-efficiency measures, which
could temper the rise in oil prices as demand recovers.
The IEA estimates oil demand this year will fall by 3%, the sharpest drop in about 30 years,
to about 83 million barrels a day.
Many analysts, however, say they believe crude prices in the next few years could again soar
over the $100-a-barrel mark seen last year because of two factors: relatively rapid energy
consumption growth in emerging markets like China and the fact that much of the world's
easy-to-tap oil is already discovered.
Benchmark crude prices on Tuesday closed up 62 cents at $59.65 a barrel on the New York
Mercantile Exchange.
Through criticized at times for missing some industry developments, the IEA is still seen as
one of the most reliable energy statisticians in the industry, in part due to data from its
member countries.
The agency said Canada, with the world's second-biggest proven oil reserves after Saudi
Arabia, has been worst hit by falling investment.
Around 15 Canadian oil-sands projects involving 1.7 million barrels a day in production
capacity and $150 billion of investment have been suspended or canceled. Oil sands yield a
viscous and expensive-to-produce crude.
But oil sands usually need at least $55 to $60-a-barrel crude prices to be produced
profitably. Oil has traded below that level since late last year.
By Spencer Swartz
LONDON -- Energy investment is "plunging" because of the recession, paving the way for
oil-price surges within three years, the International Energy Agency warned in a new report.
The Paris-based watchdog for the world's major energy-consuming nations said that in recent
months, oil companies and investors have canceled or postponed about $170 billion of investment
equivalent to roughly two million barrels a day in future oil supply.
An additional 4.2 million barrels a day in future oil-supply capacity has been delayed by at
least 18 months as companies slash spending.
The study will be presented to energy ministers from the Group of Eight industrialized
nations this weekend in Rome and to G-8 leaders at a July summit.
The report highlights the growing risk that the crude supply -- though currently abundant
because of weak global consumption -- could tighten quickly once the world economy gets back on
its feet.
"What we're saying is that come around 2012 the impact of this big recession on oil
investment and capacity, if current trends continue, could be severe with much higher oil
prices," said IEA chief economist Fatih Birol. The IEA is funded by the world's 28 biggest
energy-consumers, notably the U.S. and Japan. It has long argued for more aggressive investment
in building oil capacity.
The report, which was reviewed by The Wall Street Journal, also notes that most delayed or
canceled projects are located in politically stable non-OPEC nations like Canada. Those
resources take more years to develop than crude oil found in the members of the Organization of
Petroleum Exporting Countries, which is typically easier and cheaper to get out of the ground.
The rate at which world oil demand recovers remains a critical -- and unknowable -- variable.
Several governments in the developed world are advancing energy-efficiency measures, which
could temper the rise in oil prices as demand recovers.
The IEA estimates oil demand this year will fall by 3%, the sharpest drop in about 30 years,
to about 83 million barrels a day.
Many analysts, however, say they believe crude prices in the next few years could again soar
over the $100-a-barrel mark seen last year because of two factors: relatively rapid energy
consumption growth in emerging markets like China and the fact that much of the world's
easy-to-tap oil is already discovered.
Benchmark crude prices on Tuesday closed up 62 cents at $59.65 a barrel on the New York
Mercantile Exchange.
Through criticized at times for missing some industry developments, the IEA is still seen as
one of the most reliable energy statisticians in the industry, in part due to data from its
member countries.
The agency said Canada, with the world's second-biggest proven oil reserves after Saudi
Arabia, has been worst hit by falling investment.
Around 15 Canadian oil-sands projects involving 1.7 million barrels a day in production
capacity and $150 billion of investment have been suspended or canceled. Oil sands yield a
viscous and expensive-to-produce crude.
But oil sands usually need at least $55 to $60-a-barrel crude prices to be produced
profitably. Oil has traded below that level since late last year.
Tracking India's stock rally with ETFs and ETNs
BOSTON (MarketWatch) -- Global investors were greeted with a massive rally in India's stock market to start the week after the Congress Party-led alliance scored a victory in the emerging market country's general election.
Investors are betting in a big way that the ruling party's win can provide a boost to India's economy, and in their haste to snap up shares they triggered market circuit-breakers Monday as stock benchmarks surged to double-digit percentage gains.
"I think the market still has the potential to go up by another 10% to 15%," said Deven Choksey, managing director at K.R. Choksey Shares & Securities in Mumbai. See earlier coverage.
For investors who don't have the time or means to purchase individual Indian stocks, exchange-traded funds and notes can provide a broad-based, indexed approach for catching a prolonged rally.
The Indian-stock ETFs and ETNs enjoyed gains of more than 20% on Monday as the U.S.-listed funds joined in the buying frenzy. Exchange-traded portfolios following overseas market trade in the U.S. even while the underlying markets are closed due to time-zone differences. As such, some traders use them as a rough gauge of fair value after international markets cease trading.
Choices include Barclays iPath MSCI Index Index ETN /quotes/comstock/13*!inp/quotes/nls/inp (INP 48.19, -0.84, -1.71%) , PowerShares India Portfolio /quotes/comstock/13*!pin/quotes/nls/pin (PIN 17.74, -0.44, -2.42%) and WisdomTree India Earnings Fund /quotes/comstock/13*!epi/quotes/nls/epi (EPI 16.88, -0.28, -1.63%) . Also, WisdomTree Dreyfus Indian Rupee Fund /quotes/comstock/13*!icn/quotes/nls/icn (ICN 24.28, +0.30, +1.25%) follows the local currency, while First Trust ISE ChIndia Index Fund /quotes/comstock/13*!fni/quotes/nls/fni (FNI 15.72, -0.07, -0.44%) blends Indian and Chinese stocks in a single wrapper.
The Barclays product is an ETN, which means unlike an ETF, it carries issuer credit risk. The Barclays iPath MSCI Index ETN is listed on the NYSE Arca and has more than $500 million in total assets.
At the end of April, the portfolio had 59 stocks, according to investment researcher Morningstar Inc. Top holdings were Reliance Industries, Infosys Technologies, ICICI Bank, Housing Development Finance Corp. and HDFC Bank. Not including Monday's surge, the ETN was up about 25% so far in 2009, but was off more than 45% over the trailing 12 months.
The PowerShares India Portfolio is an ETF launched in March of 2008. The tracking index is designed as a broad gauge of stocks listed on India's Bombay Stock Exchange and the National Stock Exchange. The fund has an expense ratio of 0.78%, and since it trades like an individual stock, it can be sold short. Its largest sector holdings are energy, at nearly 29%, followed by information technology and financials.
/quotes/comstock/13*!pin/quotes/nls/pin PIN 17.74, -0.44, -2.42%
30
20
10
0
09
J
S
A
WisdomTree Investments Inc. /quotes/comstock/11i!wsdt (WSDT 1.15, 0.00, 0.00%) offers a pair of India-themed ETFs. The WisdomTree India Earnings Fund weights individual stocks by their earnings yield, rather than market capitalization. It levies fees of 0.88%, and the portfolio has risen almost 23% for the year-to-date period through Monday, according to Morningstar.
Meanwhile, WisdomTree also oversees a currency ETF pegged to the Indian rupee. With an expense ratio of 0.45%, it seeks to give investors a yield comparable to local money-market rates available to foreign investors. It also provides exposure to the movement of the rupee against the U.S. greenback.
However, WisdomTree points out that the ETF is not a money market fund and isn't required to maintain a constant share price. Some U.S. money market funds "broke the buck," or fell below a net asset value of $1, during the credit crisis.
WisdomTree Dreyfus Indian Rupee Fund gained nearly 3% on Monday and hit a session high of $24.58 -- its 52-week high is $25.99.
Investors are betting in a big way that the ruling party's win can provide a boost to India's economy, and in their haste to snap up shares they triggered market circuit-breakers Monday as stock benchmarks surged to double-digit percentage gains.
"I think the market still has the potential to go up by another 10% to 15%," said Deven Choksey, managing director at K.R. Choksey Shares & Securities in Mumbai. See earlier coverage.
For investors who don't have the time or means to purchase individual Indian stocks, exchange-traded funds and notes can provide a broad-based, indexed approach for catching a prolonged rally.
The Indian-stock ETFs and ETNs enjoyed gains of more than 20% on Monday as the U.S.-listed funds joined in the buying frenzy. Exchange-traded portfolios following overseas market trade in the U.S. even while the underlying markets are closed due to time-zone differences. As such, some traders use them as a rough gauge of fair value after international markets cease trading.
Choices include Barclays iPath MSCI Index Index ETN /quotes/comstock/13*!inp/quotes/nls/inp (INP 48.19, -0.84, -1.71%) , PowerShares India Portfolio /quotes/comstock/13*!pin/quotes/nls/pin (PIN 17.74, -0.44, -2.42%) and WisdomTree India Earnings Fund /quotes/comstock/13*!epi/quotes/nls/epi (EPI 16.88, -0.28, -1.63%) . Also, WisdomTree Dreyfus Indian Rupee Fund /quotes/comstock/13*!icn/quotes/nls/icn (ICN 24.28, +0.30, +1.25%) follows the local currency, while First Trust ISE ChIndia Index Fund /quotes/comstock/13*!fni/quotes/nls/fni (FNI 15.72, -0.07, -0.44%) blends Indian and Chinese stocks in a single wrapper.
The Barclays product is an ETN, which means unlike an ETF, it carries issuer credit risk. The Barclays iPath MSCI Index ETN is listed on the NYSE Arca and has more than $500 million in total assets.
At the end of April, the portfolio had 59 stocks, according to investment researcher Morningstar Inc. Top holdings were Reliance Industries, Infosys Technologies, ICICI Bank, Housing Development Finance Corp. and HDFC Bank. Not including Monday's surge, the ETN was up about 25% so far in 2009, but was off more than 45% over the trailing 12 months.
The PowerShares India Portfolio is an ETF launched in March of 2008. The tracking index is designed as a broad gauge of stocks listed on India's Bombay Stock Exchange and the National Stock Exchange. The fund has an expense ratio of 0.78%, and since it trades like an individual stock, it can be sold short. Its largest sector holdings are energy, at nearly 29%, followed by information technology and financials.
/quotes/comstock/13*!pin/quotes/nls/pin PIN 17.74, -0.44, -2.42%
30
20
10
0
09
J
S
A
WisdomTree Investments Inc. /quotes/comstock/11i!wsdt (WSDT 1.15, 0.00, 0.00%) offers a pair of India-themed ETFs. The WisdomTree India Earnings Fund weights individual stocks by their earnings yield, rather than market capitalization. It levies fees of 0.88%, and the portfolio has risen almost 23% for the year-to-date period through Monday, according to Morningstar.
Meanwhile, WisdomTree also oversees a currency ETF pegged to the Indian rupee. With an expense ratio of 0.45%, it seeks to give investors a yield comparable to local money-market rates available to foreign investors. It also provides exposure to the movement of the rupee against the U.S. greenback.
However, WisdomTree points out that the ETF is not a money market fund and isn't required to maintain a constant share price. Some U.S. money market funds "broke the buck," or fell below a net asset value of $1, during the credit crisis.
WisdomTree Dreyfus Indian Rupee Fund gained nearly 3% on Monday and hit a session high of $24.58 -- its 52-week high is $25.99.
Subscribe to:
Posts (Atom)