I did a Short hedge of 10 contracts of wheat because the entire commodity market is in downward price movement. In particular, all the grains are decreasing around -0.88% and -2% since the last price (http://www.bloomberg.com/markets/commodities/futures/agriculture/), being soybean the one who has the mayor decrease. Also in other relevant markets we can observe a downward price. For example both Gold and Oil futures have a negative change in the last period and shows a downward tendency since early September.

In terms of the trends of grains we can observe a significant decrease of wheat since November 2012 (as we can see in the chart) and more slightly for soybean and corn since this September.

(Source: http://www.cmegroup.com)

As my expectations are based in the maintenance of that negative trend in wheat, I expect to win the difference of today’s and December’s selling price of wheat.