Browsing: Commodities: Examples

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Commodities: Examples

Using the Variance Risk Premium to Predict Futures Markets

Jul 15th, 2018 | Filed under: Commodities, Commodities, Commodities: Examples, Energy, Gold, Hard metals, Newly Added, oil, Risk management, Risk Management Strategies & Processes, Risk Metrics and Measurement

A new study of volatility in commodity prices indicates that both the total and the decomposed variance risk premiums of at least certain commodities markets contain information with predictive power. The variance risk premium is the pay-off of the synthetic variance swap contract. Specifically, it’s the difference between the floatingRead More

What Constitutes Price Manipulation?

Apr 24th, 2018 | Filed under: Commodities, Commodities: Examples, Energy, Newly Added, Regulatory Environment, The A.I. Industry

The two commissions that serve as market enforcers in the United States, the Commodity Futures Exchange Commission and the Securities Exchange Commission, agree on a lot. (As, indeed, one would hope, since their work has considerable overlap.) One of the points on which the commissions have general agreement is theRead More

Oil Price Shocks and Economic Growth

Apr 19th, 2018 | Filed under: Commodities, Commodities, Commodities: Examples, Investing in Commodities, Newly Added, oil

The U.S. is withdrawing from a multilateral agreement with Iran that was aimed at dissuading the Iranian regime from further progress toward nuclearization. In the meantime, the U.S. and its allies have bombed Syria in retaliation for that country’s chemical attacks on its people, and a shake-up in the topRead More

Eurekahedge: Greater China Mandates Pay Off for January

Feb 20th, 2018 | Filed under: Commodities, Commodities, Commodities: Examples, Digital currencies, Emerging Alternative Investments, Energy, Gold, Hedge Fund Industry Trends, Hedge Fund Strategies, Hedge Funds, Indexes, Investing in Commodities, Newly Added, oil, Other Topics in A.I., The A.I. Industry

A new Index Flash Update from Eurekahedge says that hedge funds are off to a positive start to 2018. The industry globally gained 2.26% in January. Among developed world mandates, North American hedge funds were up 1.89%, followed by those of Japan and Europe, which gained 1.28% each. Higher numbersRead More

Gold as a Strategic Asset

Feb 11th, 2018 | Filed under: Commodities, Commodities, Commodities: Examples, Gold, Investing in Commodities, Newly Added

The World Gold Council has recently posted its analysis of the continued relevance of gold. As one might expect from the source, the WGC finds that gold is a strategic asset that can play several valuable roles in a portfolio. Toward this end, the paper offers a chart of gold’sRead More

Ceres Report Evaluates Value of Early-Stage Clean Energy

Feb 4th, 2018 | Filed under: Alternative energy, Commodities: Examples, Emerging Alternative Investments, Energy, Newly Added, Other Issues in Private Investments, Other Topics in A.I., Private Equity, Private Investments, Socially responsible investing, SRI and Clean Energy, Venture capital

A recent publication from Ceres, a nonprofit organization devoted to promoting sustainability as a goal in both investing and corporate governance, looks at the value that early-stage clean energy products offer venture capitalists. The publication is the work of a team of five “lead authors and key contributors,” including threeRead More

Aquila Asks: Who’s Afraid of Pricey Markets?

Jan 18th, 2018 | Filed under: Commodities, Commodities: Examples, Finance & Economics, Gold, Newly Added, The Global Economy & Currencies

A new paper from Aquila Capital Group looks at managed futures, and makes the case that they offer investments tools with which one can achieve a “robust and diversifying risk/return profile.” The paper begins with the concerns many investors have at present. Record long bull markets, high asset prices, andRead More

Top 5 Alpha Stories of 2017

Dec 31st, 2017 | Filed under: Business News, Commodities, Commodities: Examples, Finance & Economics, Insolvency, Newly Added, oil, The A.I. Industry

In surveying this year for dramatic alpha-related stories, we have much whence to choose. This was the year in which the Murdoch family announced its intention to sell some of their highest value holdings to Disney. Also, in 2017 the EQT Rice merger (contested, unsuccessfully, by one prominent hedge fundRead More

Til and Heckinger on Commodity Debacles, Part I

Aug 3rd, 2017 | Filed under: Commodities, Commodities, Commodities: Examples, Energy, Investing in Commodities, Newly Added

A new paper available at SSRN looks at two infamous commodity industry melt-downs: Amaranth and MF Global. It offers a diagnosis of each. Hilary Till, of the EDHEC – Risk Institute, and Richard Heckinger, of the Federal Reserve Bank of Chicago, share the by-line. They acknowledge research assistance from KatherineRead More

The Return Characteristics of Gold Mining Stocks

Jan 3rd, 2017 | Filed under: Commodities, Commodities: Examples, Equity-linked Structured Products, Gold, Investing in Commodities, Newly Added, Structured Products

Two Maryland-based scholars have reviewed the evidence of the performance of gold mining stocks. The title of their article, which appears in the Alternative Investment Analyst Review, November 2016, puts the central question bluntly: are such stocks “more like gold or like stocks”? Let’s get the answer to that queryRead More

Dakota Access and the Army Corps of Engineers: An Odd Mistake?

Nov 13th, 2016 | Filed under: Commodities, Commodities, Commodities: Examples, Infrastructure, Newly Added, oil, Operationally Intensive Real Assets

On November 7, the U.S. Army Corps of Engineers put out a statement that said that the Dakota Access Pipeline (DAPL) had agreed to halt its controversial ongoing construction in North Dakota. The following day, which happens to have been Election Day, [so non-election news went largely uncovered], the ownersRead More

Venezuela: Thinking of Cromwell and Crude

Oct 13th, 2016 | Filed under: Commodities, Commodities: Examples, Emerging markets, Finance & Economics, Newly Added, oil, The Global Economy & Currencies

Hedge funds, among them some of those the unsympathetic call “vultures,” bought into the bonds of the Petróleo de Venezuela SA (PDVSA) early this year. PDVSA is Venezuela’s state-owned oil company, the consequence of nationalization forty years ago. Its fate turns on (a) the vagaries of post-Chavez politics in thatRead More

Investors in Extractive Industries: Practice Your Forced Grin

Sep 15th, 2016 | Filed under: Commodities, Commodities: Examples, diamonds, Newly Added, oil

A new book comes to us this year from the Mapungubwe Institute for Strategic Reflection (MISTRA), a think tank founded in March 2011 “to create a platform for engagement around strategic issues facing South Africa.” Unsurprisingly, this report suffers from the generic weakness of books written by committee—it reads asRead More

On Aluminum and Other Metals: A Thought on Physicality 

Sep 13th, 2016 | Filed under: Business News, Commodities, Commodities: Examples, Finance & Economics, Hard metals, Investing in Commodities, Newly Added

Hong Kong Exchanges and Clearing (HKEx), the company that bought the London Metal Exchange four years ago, has further expansion plans. At a recent event on the commodity markets of East Asia, Charles Li, the CEO of HKEx, spoke on this point. Li wants to create a physical metals tradingRead More

Eurekahedge: Redemptions Exceeding New Investment for HFs Worldwide

Sep 5th, 2016 | Filed under: Commodities, Commodities, Commodities: Examples, Energy, Hard metals, Hedge Funds, Newly Added, Relative Value Hedge Funds

Hedge funds have now seen three consecutive months in which redemptions have exceeded new investment, for a net outflow. The net outflow for July alone was $5.7 billion. Fortunately, July also saw performance based gains of $10.5 billion, so the total assets under management grew slightly. The table below adaptedRead More

The Shale/Fracking Revolution: 1998 to 2011

Aug 23rd, 2016 | Filed under: Commodities, Commodities, Commodities: Examples, Investing in Commodities, Newly Added, oil

A critical revolution in the crude oil and natural gas markets began 18 years ago. Gary Sernovitz, who has given the world his thoughts on this revolution in the new book The Green and the Black, has had some convenient seats whence to observe, most recently as a managing directorRead More

Crude Oil at Mid-Year: IEA Assessment

Jul 17th, 2016 | Filed under: Commodities, Commodities: Examples, Newly Added, oil

As this year began, crude oil prices were stuck at their lowest level in twelve years. The world seemed to be bulging with surplus of the stuff. In January, the International Energy Agency estimated that the excess of supply over demand through the first half of the year would beRead More

The Case Against a Bearish Argument on Crude Oil

Jun 2nd, 2016 | Filed under: Commodities, Commodities: Examples, Newly Added, oil

  A recent Bloomberg story indicates that in a world  awash in cheap crude oil, traders are now storing the stuff at a loss, at sea, on board vessels in the Straits of Malacca. Further, they are going into debt so they can bear this loss. Citing Morgan Stanley analysts,Read More

Platts Windows and Cash Settlements

May 19th, 2016 | Filed under: Commodities, Commodities: Examples, Newly Added, oil

The “Platts window,” a metaphorical structure named after the influential provider of benchmark price assessments in various energy markets, consists of the final few minutes of trading, the period in the operation of an exchange when an aggressive player can have a big effect on the closing price.  A recentRead More

Dry Bulk Shipping Recovery: Three Causes

May 5th, 2016 | Filed under: Commodities, Commodities: Examples, Equity Hedge Funds, Hard metals, Hedge Funds, Newly Added

The value of the equity of Star Bulk (SBLK) has risen since the start of the year from $0.616 to just above an even dollar per share.  This is part of a broader trend. The dry bulk shipping industry, long in free fall, may have found its bottom. This isRead More

Proposed Reg AT: Comments Pile Up at the CFTC

Mar 22nd, 2016 | Filed under: Commodities, Commodities, Commodities: Examples, Energy, Newly Added, oil, Regulatory Environment, The A.I. Industry

The CFTC received a last-minute pile-up of comments on proposed rule 80 FR 78824, on automated trading. The commenters generally are not in a mood to pat the agency on its intangible back and congratulate it on a job well done. Quite the contrary. The notice of proposed rule-making (NPRM)Read More

Wrestling with the Bifurcation of Crude Oil Pricing

Mar 13th, 2016 | Filed under: Commodities, Commodities: Examples, Newly Added, oil

Platts, the provider of physicals and futures markets prices affiliated with McGraw Hill Financial, says that it is going to launch a new price reference for Dated Brent CIF Rotterdam.  That’s not obviously a stop-the-presses moment, even for the oil markets, but it is worth a pause. The problem forRead More

FCStone Financial on Grains and Volatility

Mar 10th, 2016 | Filed under: Commodities, Commodities, Commodities: Examples, Finance & Economics, Forex, Investing in Commodities, Newly Added, The Global Economy & Currencies

A new white paper written by Arlan Suderman, chief commodities economist for INTL FCStone Financial, discusses the consequence of the strong dollar of the last two years on the volatility of grain prices, focusing especially on corn. Before this period, there was the global financial crisis, and the “quantitative easing”Read More

Gold Markets Get a Leap Day Surprise from India

Mar 8th, 2016 | Filed under: Commodities, Commodities: Examples, Gold, Hard metals, Investing in Commodities, Newly Added

According to the Commodity Futures Trading Commission’s Commitment of Trader’s Report, released Friday, February 26, speculators in gold recently increased their long position by 30,350 contracts.Read More

More about Arch Coal and the Dusty Trail Ahead

Jan 24th, 2016 | Filed under: Commodities, Commodities, Commodities: Examples, Energy, Investing in Commodities, Newly Added, Other Topics in A.I., Socially responsible investing, SRI and Clean Energy

I wrote here last week about the demise of Arch Coal.  I was reminded of the incompleteness of my treatment there by the commenters on that piece, and I’ve been reminded again by subsequent developments. More then: in December 2013 Arch made a tender offer for its $600 million ofRead More

Arch Coal: Another One Bites the Coal Dust.

Jan 13th, 2016 | Filed under: Alternative energy, Commodities, Commodities, Commodities: Examples, Energy, Investing in Commodities, Newly Added, Other Topics in A.I., SRI and Clean Energy

Arch Coal, one of the biggest coal companies in The United States, entered Chapter 11 Monday morning, Jan 11. A prominent law firm, Davis Polk & Wardwell, will be taking it through the process, as will financial advisor PJT Partners. Arch (NYSE:ACI) hit its recent high stock price on AugustRead More

Commodities: Catching a Falling Knife on the High Seas

Jan 5th, 2016 | Filed under: Commodities, Commodities: Examples, Energy, Equity Hedge Funds, Hedge Funds, Newly Added, oil

The problem with a Star Bulk play or with analogous plays in the equity of dry bulk shippers is that the bottom of this bargain basement may not yet have been found. The problem behind the problem is China, which has fallen out of love with imported coal. Read More

The Hunts’ Silver Play, and Other Stories from the Recent Past

Nov 19th, 2015 | Filed under: Commodities: Examples, Hard metals, Newly Added

In January 21, 1980, the Comex board declared the Hunt silver corner an emergency, and the members voted to allow liquidation-only trading. This had its intended consequence of changing the direction of price moves, and a perhaps-unintended consequence of setting off a panic two months later. Read More

The End of the Oil Major?

Oct 21st, 2015 | Filed under: Business News, Commodities: Examples, oil

The latest industry reports indicate that oil majors’ spending on exploration and development projects will drop by at least half, casting doubt over near-term future discoveries.Read More

The Canary in the Coal Stocks and Fossil Fuel Divestment: the Portfolio You Save May Be Your Own

Sep 14th, 2015 | Filed under: Climate change, Commodities, Energy

A Wall Street analyst recommends bottom fishing in fossil fuel stocks and does an excellent job in analyzing all the market forces EXCEPT the primary one, rapidly increasing climate change. If he is typical of Wall Street expert analysis on fossil fuel stocks, be afraid. Be very afraid. Read More

Study Says The Gold Bugs are Right

Aug 23rd, 2015 | Filed under: Currencies, Forex, Gold, Hard metals, Risk management

Gold seems, to a larger extent than silver, and even more so to an extent larger than is true for palladium or platinum, to work as a true financial asset: decoupled from price developments in the commodity markets. It succeeds as a hedge against currency and stock-market trouble.Read More

Copper Prices: Why the Downslope?

May 26th, 2015 | Filed under: Commodities, Hard metals, Risk management, Technology

How long will it take before the world again sees copper at around $10,000 a ton, the going price it touched (though briefly) in early 2011? Perhaps several more years and another full business cycle. There may be a lot of down before an upturn gets us there. Read More

Some Assets are Hard to Ignore

Apr 23rd, 2015 | Filed under: Alpha Hunters, Alpha Strategies, Currencies, Gold, Hard metals, Infrastructure

Guest columnist Diane Harrison looks at the world of alternatives to alternatives, including stamps, cars, farmland and more...Read More

Down Memory Lane: That WTI-Brent Divergence

Feb 18th, 2015 | Filed under: Commodities, Infrastructure, oil

For one professor, the surprising divergence in the prices of WTI/Brent crude in the period 2010-2012 was a case study in how commodity prices can teach us about supply chain conditions. Faille looks back at his article, and forward past today's calmer but still-fluctuating spread. Read More

Don’t Blame the Swiss: Results Discounted Days Before Vote

Dec 8th, 2014 | Filed under: Commodities, Currencies, Forex, Gold, Hard metals

The price of gold took a swan dive as November ended, just as Swiss voters formally nixed an initiative that would have required the central bank to buy a lot of the stuff. Faille argues that this is not a matter of cause and effect. It is, on the other hand, a fascinating case study in the discounting machinery that is a market. Read More

The need-to-knows of Master Limited Partnerships (MLPs)

Dec 7th, 2014 | Filed under: Alpha Strategies, Energy

Guest columnist Andrew Smith, CAIA, deep dives the Master Limited Partnership (MLP) structure.Read More

The Undead Enron Model Returns to the World above Ground

Nov 2nd, 2014 | Filed under: Commodities, Energy, Legislation/Court rulings, Regulatory

Enron was once the leader in a category of merchant traders that mediated in the world of energy commodities. Enron died, and banks largely took it over. Yet in spirit, at least, Enron is back. Read More

November Vote: Do the Swiss Believe in Gold?

Oct 22nd, 2014 | Filed under: Currencies, Gold, Hard metals

The Swiss National Bank and the government oppose a pending referendum that would drastically change the country's policy on gold. But of course the anti-establishment nature of the petition is the whole point. Read More

The Bubble This Time: Oil & Gas Energy Stocks?

Oct 15th, 2014 | Filed under: Commodities, Energy, Indexes

If we look for the recent peak in Dow Jones U.S. oil & gas stocks we’ll look to the start of the summer. In June of this year the energy sector got above $850. The fall from that height puts the size of our correction in the neighborhood of 16%. It is possible these stocks are leading the rest of the market down. Read More

Old-Line Oil and Coal are Techno and Exciting These Days

Oct 1st, 2014 | Filed under: Alternative energy, Energy, Venture capital

Revolution is underway in the energy world. For investors, one of the most unexpected facts about this revolution is that it permeates precisely those portions of the energy sector long thought sleepy and conventional: the fossil fuels. Read More

Death of the Dollar: Consequences Worldwide

Aug 21st, 2014 | Filed under: Alpha Strategies, Gold, Hard metals

Rickards' new book expands on some of the themes of his 2011 publication, Currency Wars. The new book is, specifically, about the end of a particular phase in the history of money, the reserve significance of the U.S. dollar. Read More

Markets Work: The Argument from Robert Bork’s Beard

Aug 13th, 2014 | Filed under: Currencies, Hard metals

Markets work. We are warranted in believing this because it has proven itself in human history and we have studied history. Centralized social planning fails. Now, having said all that, let's talk about the Fed. Read More

Windfall: a Book on the Rise of the Climate Investor Class

Aug 6th, 2014 | Filed under: Alpha Strategies, Climate change, Energy, Social investing

Guest columnist Doug Friedenberg reviews "Windfall," and looks at the potential for investing in a changing climate.Read More

China’s Oil Giant At Center Of Corruption Probe

May 27th, 2014 | Filed under: Energy's Ky Krauthamer looks at corruption in China's oil industry.Read More

Producing Energy: The Closest Thing to a Perfect Asset

Jul 7th, 2013 | Filed under: Alpha Seekers, Commodities, Energy

Guest columnist Paul Thomas looks at the energy markets.Read More

Another Energy Boom is on the Way

Apr 17th, 2013 | Filed under: Energy

Guest columnist Dan Dicker looks at oil and energy.Read More

Is Tunisia the New Hot Spot for Energy Investors?

Apr 11th, 2013 | Filed under: Energy, oil

James Stafford talks to John Nelson, CEO of Africa Hydrocarbons Inc. about what should be on the energy investors' watch list.Read More

What SandRidge May Herald for Challenge Slates

Mar 27th, 2013 | Filed under: Energy, oil

Litigation before the Delaware Chancery Court, Kallick v. SandRidge, led to an opinion issued March 8 that addresses when a board of directors must approve a particular dissident slate for the purpose of avoiding a so-called “poison put.”Read More

NG Futures Traders: Who’s Your Regulator?

Mar 24th, 2013 | Filed under: Commodities, CTA, Energy, Regulatory

As a three-judge panel of the D.C. Appeals Court saw it, there were two questions in the Brian Hunter case. First, did the CEA’s language encompass manipulation of NG futures contracts as part of the exclusive jurisdiction of intervener CFTC? Second, if so, was that repealed or modified by the 2005 legislation? Read More

Dollars and Nuggets Part II: Spain, Cyprus, and the Future

Mar 19th, 2013 | Filed under: Commodities, Currencies, Hard metals

The present global monetary situation, plainly, is not at equilibrium. Everybody else’s currencies depend upon the dollar, the dollar depends upon petroleum, and petroleum depends upon … whatever. Changes will continue (through a succession of crises if no other way can be developed) until a new equilibrium can be attained.Read More