What Went Right/Wrong

This week was a huge success for me in the trading game. As I had mentioned in my last blog entry that I will be making my trade with respect to the information that come out of the USDA crop report. It turned out that there was another independent report which came out on Friday and findings in both of them were keenly observed by the traders and merchants. Prior to going in, I scanned a few columns and all the predictions seemed to indicate a rise in the estimated for domestic soybean and a decline in the production of domestic corn.^1,2 Therefore, I went short on soybeans anticipating a lower price in the future and went long on corn. I was pretty confident in my predictions so I went with 2 contracts each. As the weak progressed, the corn prices stayed relatively stable with minimal changes, possibly due to the fact that the USDA prediction of trimming production was not very significant. On the other hand, the soybeans market acted just the way I had anticipated it. There were substantial downward shifts in soybeans prices, which meant substantial gains! Overall, I lost $302 on my corn contracts, whereas I won $ 4348 on soybeans.

(1)    Nov. (S2X) – SHORT: Price In: 1505.5, Price Out: 1462, Gain/Loss: 2174

(2)    Nov. (S2X) – SHORT: Price In: 1505.5, Price Out: 1462, Gain/Loss: 2174

(3)    Dec. (C2Z) – LONG: Price In: 744.5, Price Out: 741.5, Gain/Loss: -151

(4)    Dec. (C2Z) – LONG: Price In: 744.5, Price Out: 741.5, Gain/Loss: -151

(3)    Equity (Last Week): 38885.09; Equity (This Week): 43630.32

References:

¹http://online.wsj.com/article/BT-CO-20121011-709060.html

²http://www.agriculture.com/news/crops/me-soybes-in-fridays-repts_2-ar27343