Next week will be our last week of trading! Oh….how I wish those 82,950 profits can be turned into real money!! hahahah…guess I should turn back to reality *sighh*
anyway…here we go:
Quick Recap — Right now I am holding 6 short contract for corn, 5 short positions for soybeans, and 6 short positions for wheat. Marginal balance at 65430.
___________________________________________________________________
Nov. 8th Tues
The US dollar is facing upward pressure from a boost due to the outcome of a key budget vote in Italian parliament (http://www.proactiveinvestors.com.hk/market_news/4374-gold-holds-steady-at-1-795-as-us-dollar-climbs.html). However, the corn harvest this year is the lowest in these past 3 years, and soybeans are also continuing to decrease in annual yield over the past 3 years (http://www.mitchellrepublic.com/event/article/id/58750 ). Thus, I predict that the prices of commodities would probably increase for a bit due to the shortage in supply, but would decrease as the Euro debt crisis is having a significant impact on the US dollar. Furthermore, the supply of wheat is abundant as this year has the largest reserves in a decade of wheat production (af.reuters.com/article/commoditiesNews/idAFL4E7M90BV20111109). So, I predict the wheat should decrease, but because corn and wheat are substitutable, wheat price might be pushed up if corn price is actually going to increase, which turns investors to wheat instead. So I decided to bid for 5 long positions and 3 long positions for corn and soybeans, respectively. Margin balance was 73190
Wed. Nov 9th
Today, I read news that the production of soybean, wheat and corn are actually not as bad as yesterday’s reports. In fact, prices have decreased for all the commodities. EU debt crisis is having a large impact on the US dollar, causing it to continue appreciate http://www.torfx.com/blog/the-pound-was-generally-weaker-against-the-us-dollar-exchange-rate-following-the-u-s-non-farm-payrolls-report/10801/. However, my strategy in thinking about this decrease in commodity prices could be because wheat had large reserves when corn supply is lowest in 3 years. So, upon knowing that, investors are substituting corn with wheat instead, and thus causing the corn price to decrease as well. I decided to offset the long contracts that I bade for yesterday, by taking 3 short positions each for corn and soybeans. Margin balance was 82380 at the end of the day.
Thurs Nov 10th
Today I read that there is huge panic about the massive debt in Italy, which is worsening the Euro crisis, along with the political issues between Italy and Greek. Also, even the European Union has warned that next year they may slip into “a deep and prolonged recession”. This caused the US dollar to rally sharply and regained its ground as investors are turning to the safe-haven once again. Thus, I am expecting the prices of commodities to be bearish because of this significant impact of the Euro crisis. Since my bids were unsuccessful yesterday, I am going to attempt for 4 short positions in corn, 3 short for soybeans, and 1 short contract for wheat.
___________________________________________________________________
Currently, I am holding 1,2,6 short positions for corn, soybeans and wheat, respectively. My margin balance is 82,950. For this last week, I plan to continue bidding for a few more short contracts for corn and soybeans since my bids the previous 2 days were all unsuccessful (predicted a higher price), should I expect the commodities to be bearish.
Hi Lisa
U really read a lot of information and news…………….Now I know the reason why u can gain that much……………..
Btw do you think the EU debt really influences much on commodity price?!
Yes, I think EU debt has a significant impact on prices. It seems like this week even though supply is low, prices still dropped because of EU debt
Hi Lisa,
wow you earned hugh profits again this week!!!Congratulations!!!~
Actually I think I learned a lot from your strategy again this week about the significant factors which affect the market price…and I think I need to mark it down now since I think it will be very useful for me to get more sense about the market price from the news, and it will be useful for me if I am continuously gonna play this game by myself in the future~Thank you!!!~
And I think you can really turn it out into real money in the future, keep up the good work!!!~
I hope I can make some real money with this in the future tooo…..hopefully it won’t turn around and lose huge when it comes to the real money ahahahhaaha 🙂 thanks~!!
Nice blog.
You’ve made so many profits and you are likely to be the NO.1 in our class.
Anyway, I really appreciate ur bidding strategies and it seems that u can capture the market well. As u know, since I lost a lot for this game, I no longer dare to have so many positions in hand, even they may realize me some profits….
heheheheh 🙂 I do have a lot of positions on hand, but I think I can still offset pretty fast since we can bid for 5 contracts each time! Hope you can gain some back this last week zheng!! (or maybe u will gain big when you start your research next term 😛 )
Hey lisa!!!hahahaha wowoww soo much money!!!
I think u really have a good eye to catch the most important news and u know the good timing,by which i mean u know whens the news for which bid…
Im quite surprised that u can hold like 6 and 5 contracts for commodities…thats too risky for me since i cant handle them well! i never hold more than 3…since its the end of the game i thought to be more aggressive to hold THREE hahahahhaha
thx for sharing ur insights!and nice to be group with u:)
Yesss I’m so happy to be in the same group with u too fancyyy!
I think 6 or 5 contracts is not a lot in this case, because I still have control over them since we can bid 5 each time if i want to offset…..
Hey Lisa,
Good job on your strategy! I was confused with the low inventories on corn and soybean and the news on EU crisis. I was not sure how I should build upon from those factors. But you did well! I should follow your strategy on shorting corn and soybean. Thanks for sharing!
Yijeong
Yes, I predicted that the EU crisis would overpower the other news for this week…..:)
Good Work Lisa!
Looks like you’re making huge profits in this game. It seems you’ve also got some pretty big short positions right now. Good work!
I agree on all the information regarding the EU crisis (probably because I’m in your exchange rate group). It seems that the crisis has been overpowering any other factors in the news in regards to prices. I read an article which stated that decreased supply had virtually no effect on prices because the EU debt crisis holds such massive weight in investor attitudes.
Actually, I should probably comment on how big your positions are. keep in mind that if things turn around in a hurry, those big short contracts could face a loss…
That said, I personally feel it may be unlikely. Even if confidence were restored in the EU crisis, it wouldn’t be met with reckless abandon. More likely, investors would move slowly and cautiously in driving prices up (which should give you plenty of time to close your positions). just keep an eye on it, and know when to get out.
I agree with you (probably because we have been reading and discussin on the Euro crisis and US dollar a lot). I think the big contracts that I am holding is still within my control…because I can offset by bidding 5 contracts right away if I need to……but you’re right, I am not planning to bid for more short contracts now…
Hey Lisa!
you have a magical power in prediction. Also, you are a fearless trader, as you always bid around 5 contracts. Hopefully, you can keep this much profit in the last week.
About bidding on Wed., I read lots of news and an increase in prices had been predicted by analysts. But you forecast a decrease in prices. You were right and it was very strange, this is why I called you “magical trader”!!
Hi Hoissein!!
I do not have magical power in prediction….ahahahha!!! it’s because I really do read a lot on the fundamentals and tecnical, and trying to learn how to weigh the factors against each other to plan my moves!! I am not a fearless trader …….but I just think that I can offset since we can bid 5 contracts each time right?? so I am still having control over my positions right now…..I also hope i can keep this profit, and make close to 100,000 this last week 🙂