Charlie Munger on Economics and America
Anyone reading Charlie Mungers parable over at Slate over the weekend should come away very sober, with the realization why precious metals like gold and silver, along with other commodities, will do well over the years ahead.
The parable by Charlie Munger attacked on two fronts. The first was the outrageous practices of the U.S. government which is out of control with its spending and taxation, and discourages entrepreneurs from flourishing when all they do is take wealth away from them and redistribute it like the growing socialist government and administration we now have.
On the private business side, Munger blasted the derivative trading of the banks which were a major part of the underlying problems many of us face.
While this is all true and accurate, we still face the consequences of the actions of the U.S. government and major banks no matter what is done in attempts to deal with the root causes.
This is why commodities will continue to be the major success story over the next decade or more, as real things will continue to be in demand, rather than things most people can't begin to understand.
Charlie Munger on Economics and America
Showing posts with label Commodity Investment. Show all posts
Showing posts with label Commodity Investment. Show all posts
Wednesday, February 24, 2010
Tuesday, February 23, 2010
Managed Commodity Assets Fall
Managed Commodity Assets Fall
Managed commodity assets fell for the first time in over a year, said Barclay's Capital, evidently based on worries over the global economy.
Overall commodity assets under management dropped to $245 billion, a $12 billion fall from the $257 billion from last month.
In what I think is a strange response to uncertainty, investors took close to $500 million out of exchange-traded funds, with the majority of that being funds backed by gold and a variety of other precious metals.
At a time when uncertainty should drive smart investors to gold, the idea that taking it out of gold and moving it to something else is ignorant and bizarre, although obviously a lot more was happening than only that in the overall commodity managed assets picture.
Managed Commodity Assets Fall
Managed commodity assets fell for the first time in over a year, said Barclay's Capital, evidently based on worries over the global economy.
Overall commodity assets under management dropped to $245 billion, a $12 billion fall from the $257 billion from last month.
In what I think is a strange response to uncertainty, investors took close to $500 million out of exchange-traded funds, with the majority of that being funds backed by gold and a variety of other precious metals.
At a time when uncertainty should drive smart investors to gold, the idea that taking it out of gold and moving it to something else is ignorant and bizarre, although obviously a lot more was happening than only that in the overall commodity managed assets picture.
Managed Commodity Assets Fall
Sunday, February 14, 2010
Commodities and Sovereign Default = Opportunity
Commodities and Sovereign Default
It's interesting to read what some think will be the ruin of commodities because of the potential sovereign default from a growing number of countries, including Greece, Ireland, Spain and Portugal.
Of course the problem with ignorant writers on commodities is they're clueless as to how you make money with commodities, which is when they're on the way up or on the way down, so whether the price is going up or down for commodities is irrelevant from that point of view.
These writers only think in terms of whether or not those trying to make money on commodity prices going up are going to get clobbered, not realizing or even in some case - even knowing, that you make money either way.
For those investing in commodities, it doesn't make any difference whether you make the money on upwards or downwards price movements.
So don't forget to include that in your decision making going forward, as potential significant price movements in commodities one way or the other are always potentially great opportunities to make a lot of money.
Commodities and Sovereign Default
It's interesting to read what some think will be the ruin of commodities because of the potential sovereign default from a growing number of countries, including Greece, Ireland, Spain and Portugal.
Of course the problem with ignorant writers on commodities is they're clueless as to how you make money with commodities, which is when they're on the way up or on the way down, so whether the price is going up or down for commodities is irrelevant from that point of view.
These writers only think in terms of whether or not those trying to make money on commodity prices going up are going to get clobbered, not realizing or even in some case - even knowing, that you make money either way.
For those investing in commodities, it doesn't make any difference whether you make the money on upwards or downwards price movements.
So don't forget to include that in your decision making going forward, as potential significant price movements in commodities one way or the other are always potentially great opportunities to make a lot of money.
Commodities and Sovereign Default
Wednesday, February 10, 2010
Mark Mobius Likes Commodity Stocks
Mark Mobius Likes Commodities
While most of us that know Mark Mobius understand his focus and investment strategy concerning emerging markets, we also need to include his take on the commodity market as well.
For emerging markets, what all of us need to understand is commodities will continue to play a big part in their growth, whether its a large country or not, as for the most part it'll be stuff that generates growth for them majority of them, not high-tech products and services to start off with.
With that as a background, Mobius recently said that "Commodity stocks look good because we expect the global demand for commodities to continue its long-term growth. Consumer stocks are also favoured. With rising per capita income and strong demand for consumer goods, the earnings growth outlook for these stocks is positive."
Mobius added we must be good risk managers during this period of time, as there will continue to be huge fluctuations in all markets, of which commodities are usually always like, even in the best of times.
Some of the things Mobius advises to look out for and the risks he's talking about are:
"Risks such as the inability of governments to control the derivatives markets, loss of confidence, over or poor regulation and abandonment of the market economy philosophy do also exist. Therefore, we must pay attention to valuations and long-term earnings growth prospects in order to avoid buying or holding expensive stocks as a result of dramatic price rises that we have seen."
Mark Mobius Likes Commodities
While most of us that know Mark Mobius understand his focus and investment strategy concerning emerging markets, we also need to include his take on the commodity market as well.
For emerging markets, what all of us need to understand is commodities will continue to play a big part in their growth, whether its a large country or not, as for the most part it'll be stuff that generates growth for them majority of them, not high-tech products and services to start off with.
With that as a background, Mobius recently said that "Commodity stocks look good because we expect the global demand for commodities to continue its long-term growth. Consumer stocks are also favoured. With rising per capita income and strong demand for consumer goods, the earnings growth outlook for these stocks is positive."
Mobius added we must be good risk managers during this period of time, as there will continue to be huge fluctuations in all markets, of which commodities are usually always like, even in the best of times.
Some of the things Mobius advises to look out for and the risks he's talking about are:
"Risks such as the inability of governments to control the derivatives markets, loss of confidence, over or poor regulation and abandonment of the market economy philosophy do also exist. Therefore, we must pay attention to valuations and long-term earnings growth prospects in order to avoid buying or holding expensive stocks as a result of dramatic price rises that we have seen."
Mark Mobius Likes Commodities
Thursday, February 4, 2010
Commodity Prices Drive Emerging Market Stocks Up
Commodities and Emerging Markets
Stocks reflecting emerging markets enjoyed their based gain in a couple of months as commodity prices helped them rebound as some are starting to believe the economic recovery is real and demand for raw materials will increase.
As a result, the MSCI Emerging Markets Index surged 1.8 percent to 957.11 at a little past 11:00 a.m. in London, the most dramatic increase since Dec. 1, 2009.
Other major indexes increased as well with the Russian Micex Index of stocks rising by 1.2 percent; the Shanghai Composite Index of China increasing by 2.4 percent; and the Sensex Index in India gaining 2.1 percent.
Commodities and Emerging Markets
Stocks reflecting emerging markets enjoyed their based gain in a couple of months as commodity prices helped them rebound as some are starting to believe the economic recovery is real and demand for raw materials will increase.
As a result, the MSCI Emerging Markets Index surged 1.8 percent to 957.11 at a little past 11:00 a.m. in London, the most dramatic increase since Dec. 1, 2009.
Other major indexes increased as well with the Russian Micex Index of stocks rising by 1.2 percent; the Shanghai Composite Index of China increasing by 2.4 percent; and the Sensex Index in India gaining 2.1 percent.
Commodities and Emerging Markets
Thursday, January 28, 2010
Commodities VaR: Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS) and JPMorgan Chase (NYSE:JPM) Down 25 Percent from 2008 Highs
Commodity VaR Major Financial Institutions
In the midst of all the Obama proposal for restrictions on proprietary trading for commodities and other securities, it has been found via the data that financial institutions like Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS) and JPMorgan Chase (NYSE:JPM) have decreased their Value-at-Risk, or VaR, for commodities, by a minimum of 25 percent since their highs during the ongoing commodity surge in 2008.
That data is in reference to numbers crunched in the fourth quarter of 2009.
What VaR deals with is the confidence or willingness for a financial institution to trade in a particular market sector.
Even so, it's interesting that while the risk appetite seems to have declined some in the fourth quarter, commodities and currency investments helped some of the major financial institutions in America perform much better than they would have without those investments.
Volatile times right now will probably keep commodities in check for the short term, but almost every announcement one way or the other seems to push commodity prices in one direction or the other as uncertainty about true economic recovery, interest rates and what China will invest in commodities in 2010 has the commodity market skittish and seemingly all over the place.
Commodity VaR Major Financial Institutions
In the midst of all the Obama proposal for restrictions on proprietary trading for commodities and other securities, it has been found via the data that financial institutions like Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS) and JPMorgan Chase (NYSE:JPM) have decreased their Value-at-Risk, or VaR, for commodities, by a minimum of 25 percent since their highs during the ongoing commodity surge in 2008.
That data is in reference to numbers crunched in the fourth quarter of 2009.
What VaR deals with is the confidence or willingness for a financial institution to trade in a particular market sector.
Even so, it's interesting that while the risk appetite seems to have declined some in the fourth quarter, commodities and currency investments helped some of the major financial institutions in America perform much better than they would have without those investments.
Volatile times right now will probably keep commodities in check for the short term, but almost every announcement one way or the other seems to push commodity prices in one direction or the other as uncertainty about true economic recovery, interest rates and what China will invest in commodities in 2010 has the commodity market skittish and seemingly all over the place.
Commodity VaR Major Financial Institutions
Monday, January 25, 2010
Commodity Buying Opportunity?
Commodity dip in prices
I think so. When you look at two of the best things that could have happened for those looking for a commodity price correction, you couldn't have had better circumstances than Obama and the Chinese leadership making the statements they did last week; both of which has a negative impact on commodities' outlook and prices.
The question is if the impact of their comments will be sustainable over a long period of time or commodity prices will continue their upward surge after many of them reaching highs recently.
It seems to me there is no way commodities over the long term will suffer long-term price decreases, although times like these are great opportunities to buy up even more raw materials going forward.
The only commodity to be cautious of concerning price is copper, which increased in price in spite of the thoughts communicated by the Chinese and Obama.
Taking everything into consideration, and even if China's leaders want to try to slow down their growth, commodities will be a huge story in relationship to China for some time to come, so when this nice dips happen, it's time to stock up again and increase our positions.
Rumor is a number of funds had been seriously thinking of decreasing their exposure to commodities. Hopefully they will and the story gets out everywhere, as it should help prices drop even more and give more opportunity to buy low.
Commodity dip in prices
I think so. When you look at two of the best things that could have happened for those looking for a commodity price correction, you couldn't have had better circumstances than Obama and the Chinese leadership making the statements they did last week; both of which has a negative impact on commodities' outlook and prices.
The question is if the impact of their comments will be sustainable over a long period of time or commodity prices will continue their upward surge after many of them reaching highs recently.
It seems to me there is no way commodities over the long term will suffer long-term price decreases, although times like these are great opportunities to buy up even more raw materials going forward.
The only commodity to be cautious of concerning price is copper, which increased in price in spite of the thoughts communicated by the Chinese and Obama.
Taking everything into consideration, and even if China's leaders want to try to slow down their growth, commodities will be a huge story in relationship to China for some time to come, so when this nice dips happen, it's time to stock up again and increase our positions.
Rumor is a number of funds had been seriously thinking of decreasing their exposure to commodities. Hopefully they will and the story gets out everywhere, as it should help prices drop even more and give more opportunity to buy low.
Commodity dip in prices
Tuesday, January 5, 2010
Commodity Prices Increasing in 2010 Says IMF
Commodity Prices Increasing in 2010
The IMF just released its view on what the price movements of commodities will be in 2010, and in general, like me, they believe a stronger demand will push the prices higher as Asian markets start to rebound.
Thomas Helbling from the IMF Research Department added though that commodity prices would be tempered by higher stocks, which could keep prices in a number of cases from exploding upwards, but still should increase gradually.
Another factor of course is whether we're really in a recovery, and if that will translate into increased demand.
For the Asian markets that could be the case, although Western markets and the U.S. aren't anywhere near a recovery, contrary to mainstream press accounts.
Even so, the commodity price index of the IMF has risen by 40 percent from February 2009, and that was during what was considered a down year.
The commodity price index of the IMF should increase to much higher levels this year, even with commodity inventories high.
Over the long term the IMF expects commodity prices to remain high in general, and not fall down to historical levels.
Commodity Prices Increasing in 2010
The IMF just released its view on what the price movements of commodities will be in 2010, and in general, like me, they believe a stronger demand will push the prices higher as Asian markets start to rebound.
Thomas Helbling from the IMF Research Department added though that commodity prices would be tempered by higher stocks, which could keep prices in a number of cases from exploding upwards, but still should increase gradually.
Another factor of course is whether we're really in a recovery, and if that will translate into increased demand.
For the Asian markets that could be the case, although Western markets and the U.S. aren't anywhere near a recovery, contrary to mainstream press accounts.
Even so, the commodity price index of the IMF has risen by 40 percent from February 2009, and that was during what was considered a down year.
The commodity price index of the IMF should increase to much higher levels this year, even with commodity inventories high.
Over the long term the IMF expects commodity prices to remain high in general, and not fall down to historical levels.
Commodity Prices Increasing in 2010
Saturday, December 12, 2009
Banks Expanding Commodity Staff
With a look toward inevitable inflationary pressures, banks have been adding to their commodities staffs as they look to make some good money in the sector as faith in the U.S. dollar continues to plummet.
It is expected to be a banner and breakout year for commodities this year, as investors have more appetite for risk and economic uncertainty make commodity investing look good.
The reason why there is more appetite for risk in the midst of economic uncertainty is the growing demand for commodities, which will continue no matter what the economic circumstances are.
Real economic recovery seems to be happening in China, and so there is no doubt the middle class demand for goods will drive up the price of commodities, not only next year, but for several years ahead.
This is why large banks are ramping up their commodities units in order to perpare for this inevitable trend to continue, as the commodity bull market has been on hold in general during the economic crisis.
Another factor has been the derivative industry, which won't function like it has in the past, and won't be destructive to banks, but won't make them any money (for the most part) either. Bank commodity investment will continue to grow, along with their staffs, as a result.
It is expected to be a banner and breakout year for commodities this year, as investors have more appetite for risk and economic uncertainty make commodity investing look good.
The reason why there is more appetite for risk in the midst of economic uncertainty is the growing demand for commodities, which will continue no matter what the economic circumstances are.
Real economic recovery seems to be happening in China, and so there is no doubt the middle class demand for goods will drive up the price of commodities, not only next year, but for several years ahead.
This is why large banks are ramping up their commodities units in order to perpare for this inevitable trend to continue, as the commodity bull market has been on hold in general during the economic crisis.
Another factor has been the derivative industry, which won't function like it has in the past, and won't be destructive to banks, but won't make them any money (for the most part) either. Bank commodity investment will continue to grow, along with their staffs, as a result.
Thursday, December 10, 2009
Commodities More Than For Diversification
In the past, commodities as an investment were considered a good way to diversify your portfolio. Those days are quickly leaving us as commodities are now considered a great way to generate real returns, and not just a hedge against losses or way to add balance to an investment portfolio.
One of the ways institutional investors are going about doing that is simply in trading commodities more actively. With the commodity bull market poised to resume, a large number of institutional investors say they're going to increase their commodity holdings over the next year.
A recent survey discovered that investors, like mentioned, aren't looking simply for diversification of portfolios at this time, but are looking for absolute returns. That's a lot different than what they were seeking last year with their commodity investments, which also included commodities investment as a hedge against inflation, which is still true, but no longer the key element in commodity investment decisions.
Another trend seems to be away from commodity index funds into direct investment in commodities, as well as investment in a variety of commodity exchange-traded funds. Many commodity investors are looking for more active positions rather than holding positions going forward.
The potential fallout for commodity prices is there could be a lot more volatility in the commodities market from managed commodity positions than from holding patterns associated with commodity index funds. That may also result in commodity prices having more downward pressure as well.
Estimates are that commodity assets under management at the end of 2009 could be as high as $240 billion.
Most of those that invest and follow commodities continue to believe that we're still in the midst of a commodity bull market and commodity prices overall will continue to rise.
One of the ways institutional investors are going about doing that is simply in trading commodities more actively. With the commodity bull market poised to resume, a large number of institutional investors say they're going to increase their commodity holdings over the next year.
A recent survey discovered that investors, like mentioned, aren't looking simply for diversification of portfolios at this time, but are looking for absolute returns. That's a lot different than what they were seeking last year with their commodity investments, which also included commodities investment as a hedge against inflation, which is still true, but no longer the key element in commodity investment decisions.
Another trend seems to be away from commodity index funds into direct investment in commodities, as well as investment in a variety of commodity exchange-traded funds. Many commodity investors are looking for more active positions rather than holding positions going forward.
The potential fallout for commodity prices is there could be a lot more volatility in the commodities market from managed commodity positions than from holding patterns associated with commodity index funds. That may also result in commodity prices having more downward pressure as well.
Estimates are that commodity assets under management at the end of 2009 could be as high as $240 billion.
Most of those that invest and follow commodities continue to believe that we're still in the midst of a commodity bull market and commodity prices overall will continue to rise.
Tuesday, July 28, 2009
Commodity Bull Market Will Continue
Commodity Prices, Bull Market
A number of factors will contribute to the ongoing commodity bull market, including population growth (although that isn't the primary factor) and other changes that will ensure probably at least a decade or not more of commodity price surges.
Now along with population growth, the more significant reason commodity prices will increase are the emerging middle classes in China and India, and other smaller Asian countries.
After all, population growth won't significantly change things if people aren't able to afford food. Sure, you get the subsidized food, but that always is the basics to survive, never the higher margin food middle classes enjoy and can afford.
But, either way, population growth for general food stuffs, along with available funds from emerging market consumers will drive commodity prices for years to come.
"World population growth trends suggest massive numbers of new global citizens on the way -- citizens that are going to require essentials such as food, clothing and shelter," commodity ETF expert Doug Fabian said.
"For investors who want to ride this population wave, I offer you the PowerShares DB Commodity Index, an exchange-traded fund that seeks to track the performance of the Deutsche Bank Liquid Commodity index," he added.
Of course I've been writing about this for a long time trying to show you the reasons many commodities will be highly profitable. Jim Rogers has also contributed to that conversation, saying that commodities should be the top performing investment for years into the future.
Commodity prices in many cases have dipped because of the temporary economic slowdown, and no matter how long it takes to be dug out of it, eventually commodities will begin to rise again, and when they do, they could explode in price. Of course you can make money whether commodity prices rise or fall, but this makes pricing of them easier than when there's a lot of uncertainty, which over the long term there isn't: commodity prices overall will rise, and that's a surety over the long term.
If Commodity prices continue to lag, that could be a great buying opportunity as well, and could even add to the profits of investors going forward.
Commodity Prices, Bull Market
A number of factors will contribute to the ongoing commodity bull market, including population growth (although that isn't the primary factor) and other changes that will ensure probably at least a decade or not more of commodity price surges.
Now along with population growth, the more significant reason commodity prices will increase are the emerging middle classes in China and India, and other smaller Asian countries.
After all, population growth won't significantly change things if people aren't able to afford food. Sure, you get the subsidized food, but that always is the basics to survive, never the higher margin food middle classes enjoy and can afford.
But, either way, population growth for general food stuffs, along with available funds from emerging market consumers will drive commodity prices for years to come.
"World population growth trends suggest massive numbers of new global citizens on the way -- citizens that are going to require essentials such as food, clothing and shelter," commodity ETF expert Doug Fabian said.
"For investors who want to ride this population wave, I offer you the PowerShares DB Commodity Index, an exchange-traded fund that seeks to track the performance of the Deutsche Bank Liquid Commodity index," he added.
Of course I've been writing about this for a long time trying to show you the reasons many commodities will be highly profitable. Jim Rogers has also contributed to that conversation, saying that commodities should be the top performing investment for years into the future.
Commodity prices in many cases have dipped because of the temporary economic slowdown, and no matter how long it takes to be dug out of it, eventually commodities will begin to rise again, and when they do, they could explode in price. Of course you can make money whether commodity prices rise or fall, but this makes pricing of them easier than when there's a lot of uncertainty, which over the long term there isn't: commodity prices overall will rise, and that's a surety over the long term.
If Commodity prices continue to lag, that could be a great buying opportunity as well, and could even add to the profits of investors going forward.
Commodity Prices, Bull Market
Wednesday, July 15, 2009
Commodities Still Hot - Jim Rogers
The commodities rally seems to have paused. The Rogers International Commodity Index has come off 13% since June 12. This pullback, essentially as I can see, is because of tin, energy and silver even as some of those agri commodities like orange juice, sugar and cotton have done well. What are your expectations going forward for commodities?
That's the way I know you know about commodities. You read The Economic Times and your ET TV. So, you know that the markets always have corrections whether they are going up or down. Nothing goes straight up or down forever. So, it's having a normal correction. In my view, the best place to be is in real assetscommodities, because if the world is going to recover, they (commodities) will recover first because of the shortages and if the world economy is not going to recover, they are still the best place to be, because governments around the world are printing huge amounts of money. So, if you got to own something, I don't much to own besides commodities.
In India, we are getting worried about the monsoon. We are looking out of our windows and not finding any clouds, and there is also talk about El Nino weather formation. Is this something you would advise investors to keep an eye on?
Of course, I would. The world's inventories of food are at the lowest they have been in decades. We haven't have had any serious weather problems around the world for several decades as a matter of fact. So, with fairly good weather, we have been having bad harvest or we have been consuming more than we have been producing. Can you imagine what's going to happen to the price of agriculture if we have bad weather around the world?
The last time we met here in Mumbai you had a sachet of sugar in your pocket and you pulled it out to underscore your point of impending shortage about agri commodities. You have been right about sugar as far as we can see from the price charts. What are you hiding today in your pockets? A silver coin, a hip flask full of crude oil, may be?
I do actually have a silver coin in my pocket. I don't know how you knew. I also have a gold coin, but the silver one is probably my better play. If I were a bright young man, I would be buying sugar now and silver, given the state of the world. That's not a recommendation, but I am just saying I do own some silver. Silver is cheaper than many things on a historic basis and I do own some silver. The dollar has fallen almost 10% since the beginning of the stocks rally in March. Commodities have risen 94% of the time that the dollar has fallen. A very strong correlation. Do we expect the dollar decline and the commodity run-up, therefore, to continue? It's not always a strong correlation. You are right; there has been (a correlation) in recent months, recent years even. But no, there are many times when the dollar and commodities go entirely separate ways. So, don't get it into your head, and I know many times that the press do have it in their head that commodities and dollars go opposite ways. I am not terribly bullish on the dollar in long term. US dollars are a terribly flawed currency and down the road I hope I don't own any US dollars. I still own some of them at the moment, but it's not getting better for the US. The dollar any way is getting worse. The fundamental for commodities continue to improve. The fundamentals for the US dollar do not continue to improve. They are deteriorating.
Are you still sticking to your prediction of a currency crisis sometime in a year or two?
Yes. The world is full of currency imbalances and economic trade imbalances would have to be resolved or corrected, one way or the other. Unfortunately, given the state of politicians and it's not just the current state of politicians, but politicians throughout history have usually got things wrong. So, we are going to have some problems in the currency market. I don't know when. May be not. I may be wrong. But having seen that sort of thing before in history somebody would have to pay the price whether it's the pound sterling or the US dollar or the rupee, I have no clue. No idea where it’s going to stop, but we are going to have problems in the currency markets.
What’s your view on global equities now? Do you think emerging markets’ premium over developed country markets has gone a way too high?
I don't pay any attention to things like emerging markets premium. You talk about it on TV, but every market is different. Why can't I just go out and buy emerging markets when it is likely to go broke. Every market is different, every country is different, every economy is different and every sector of the economies is different. Just because you are in an emerging country does not mean you are going to make money if you get the wrong sector. I have not bought any stocks anywhere in the world in the last couple of years except China. I did buy some Chinese shares back in October-November. I have not been buying anything other than that for some time. I have been worried about the world economy, about the world stock markets. If you got to be somewhere and if there is going to be a recovery, it will show up in commodities best of all, and if there is not going to be any recovery, commodities are still a better place to be.
So what are you buying nowadays?
If you want to put in your money somewhere, put it in commodities. That's the only thing I bought recently. I have bought some yen and swiss francs. If you know enough about currencies to figure out who is going to benefit, if I am right about the currency turmoil coming, then you can buy some of the currencies and if you think that the rupee is the place to be, then you can buy some rupees.
Long-term inflation expectations in the US as reflected by the five-year forward breaking rates on treasury inflation protected securities. Those have hardened considerably since the beginning of the year. That's also your view, right? Too much money in the financial systems and monetary authorities the world over don't have a credible plan to withdraw liquidity?
I cannot conceive of lending money to the US government for 30 years in US dollars for 3, 4, 5 or 6% interest. It's just inconceivable to me that I would let them have my money for 30 years and they would pay me back someday in US dollars at such a low rate of interest. I expect problems in the bond market. I don't know when. I am not sure about the bond market. I was short in the bond market, but I got out. I expect to see serious problems in the bond market down the road.
In the near term, markets seem to be more concerned about growth than they are about inflation. The difference between the 10-year and the two-year bond yield in the US has narrowed some 40 basis points since early June. Unlike you Jim, people are actually going out and buying long maturity treasuries because they don't see growth, don't see inflation. So, what do say to these bond buyers? Good luck?
When you see anomalies like this in the market, you are supposed to take advantage . The spread is very low. So, why would anybody buy a 10-year when he can buy a two-year ? Not worth the extra risk to go out 10 years. I would urge people to keep their wits. Now, granted Mr Bernanke and the US are buying a lot of government paper and driving the price up. That's why I am not sure. He has got more buying power than I do, at least for the foreseeable future. So, you are seeing longer bonds going up. That gives you an opportunity to get out if you own them or think about selling them short if you don't own them and know how to sell short.
Interview with Jim Rogers from India Times
That's the way I know you know about commodities. You read The Economic Times and your ET TV. So, you know that the markets always have corrections whether they are going up or down. Nothing goes straight up or down forever. So, it's having a normal correction. In my view, the best place to be is in real assetscommodities, because if the world is going to recover, they (commodities) will recover first because of the shortages and if the world economy is not going to recover, they are still the best place to be, because governments around the world are printing huge amounts of money. So, if you got to own something, I don't much to own besides commodities.
In India, we are getting worried about the monsoon. We are looking out of our windows and not finding any clouds, and there is also talk about El Nino weather formation. Is this something you would advise investors to keep an eye on?
Of course, I would. The world's inventories of food are at the lowest they have been in decades. We haven't have had any serious weather problems around the world for several decades as a matter of fact. So, with fairly good weather, we have been having bad harvest or we have been consuming more than we have been producing. Can you imagine what's going to happen to the price of agriculture if we have bad weather around the world?
The last time we met here in Mumbai you had a sachet of sugar in your pocket and you pulled it out to underscore your point of impending shortage about agri commodities. You have been right about sugar as far as we can see from the price charts. What are you hiding today in your pockets? A silver coin, a hip flask full of crude oil, may be?
I do actually have a silver coin in my pocket. I don't know how you knew. I also have a gold coin, but the silver one is probably my better play. If I were a bright young man, I would be buying sugar now and silver, given the state of the world. That's not a recommendation, but I am just saying I do own some silver. Silver is cheaper than many things on a historic basis and I do own some silver. The dollar has fallen almost 10% since the beginning of the stocks rally in March. Commodities have risen 94% of the time that the dollar has fallen. A very strong correlation. Do we expect the dollar decline and the commodity run-up, therefore, to continue? It's not always a strong correlation. You are right; there has been (a correlation) in recent months, recent years even. But no, there are many times when the dollar and commodities go entirely separate ways. So, don't get it into your head, and I know many times that the press do have it in their head that commodities and dollars go opposite ways. I am not terribly bullish on the dollar in long term. US dollars are a terribly flawed currency and down the road I hope I don't own any US dollars. I still own some of them at the moment, but it's not getting better for the US. The dollar any way is getting worse. The fundamental for commodities continue to improve. The fundamentals for the US dollar do not continue to improve. They are deteriorating.
Are you still sticking to your prediction of a currency crisis sometime in a year or two?
Yes. The world is full of currency imbalances and economic trade imbalances would have to be resolved or corrected, one way or the other. Unfortunately, given the state of politicians and it's not just the current state of politicians, but politicians throughout history have usually got things wrong. So, we are going to have some problems in the currency market. I don't know when. May be not. I may be wrong. But having seen that sort of thing before in history somebody would have to pay the price whether it's the pound sterling or the US dollar or the rupee, I have no clue. No idea where it’s going to stop, but we are going to have problems in the currency markets.
What’s your view on global equities now? Do you think emerging markets’ premium over developed country markets has gone a way too high?
I don't pay any attention to things like emerging markets premium. You talk about it on TV, but every market is different. Why can't I just go out and buy emerging markets when it is likely to go broke. Every market is different, every country is different, every economy is different and every sector of the economies is different. Just because you are in an emerging country does not mean you are going to make money if you get the wrong sector. I have not bought any stocks anywhere in the world in the last couple of years except China. I did buy some Chinese shares back in October-November. I have not been buying anything other than that for some time. I have been worried about the world economy, about the world stock markets. If you got to be somewhere and if there is going to be a recovery, it will show up in commodities best of all, and if there is not going to be any recovery, commodities are still a better place to be.
So what are you buying nowadays?
If you want to put in your money somewhere, put it in commodities. That's the only thing I bought recently. I have bought some yen and swiss francs. If you know enough about currencies to figure out who is going to benefit, if I am right about the currency turmoil coming, then you can buy some of the currencies and if you think that the rupee is the place to be, then you can buy some rupees.
Long-term inflation expectations in the US as reflected by the five-year forward breaking rates on treasury inflation protected securities. Those have hardened considerably since the beginning of the year. That's also your view, right? Too much money in the financial systems and monetary authorities the world over don't have a credible plan to withdraw liquidity?
I cannot conceive of lending money to the US government for 30 years in US dollars for 3, 4, 5 or 6% interest. It's just inconceivable to me that I would let them have my money for 30 years and they would pay me back someday in US dollars at such a low rate of interest. I expect problems in the bond market. I don't know when. I am not sure about the bond market. I was short in the bond market, but I got out. I expect to see serious problems in the bond market down the road.
In the near term, markets seem to be more concerned about growth than they are about inflation. The difference between the 10-year and the two-year bond yield in the US has narrowed some 40 basis points since early June. Unlike you Jim, people are actually going out and buying long maturity treasuries because they don't see growth, don't see inflation. So, what do say to these bond buyers? Good luck?
When you see anomalies like this in the market, you are supposed to take advantage . The spread is very low. So, why would anybody buy a 10-year when he can buy a two-year ? Not worth the extra risk to go out 10 years. I would urge people to keep their wits. Now, granted Mr Bernanke and the US are buying a lot of government paper and driving the price up. That's why I am not sure. He has got more buying power than I do, at least for the foreseeable future. So, you are seeing longer bonds going up. That gives you an opportunity to get out if you own them or think about selling them short if you don't own them and know how to sell short.
Interview with Jim Rogers from India Times
Wednesday, June 24, 2009
Secrets to Successful Commodity Investing
Commodity Investing
Commodities are sometimes made to look far too complicated for the average investor, and so many stay away from what is one of the most exciting and potentially profitable wealth builders for the next couple decades.
I'm going to simplify it for you, and in reality, there is nothing more to it than what I'm about to explain.
The simplicity of commodity investing? It's completely related to supply and demand. Isn't that simple? It's nothing more than that.
Having said that, I'm talking about investing in raw commodities here, not businesses or mining companies that are dependent on the quality of management, labor issues, and a plethora of other issues.
If it's that simple, than why does it seem so complicated? Most of the complications, or perceived complications are in connection to market timers or day traders, who are attempting to make a quick killing and move out of the market.
A lot of media coverage of commodities is connected to this because if offers up drama that interests viewers, and gives something for the talking heads to communicate.
In reality, market timers don't make much money, and those investing for the short term never make the amount of money those with knowledge and in it for the long term do.
So the illusion is created that commodities are completely unpredictable, and investing in them is like gambling. Now if you're trying to time the market, that's not only true of commodities, but it's true of any investment vehicle. Short term investing is gambling, and those entering into may get a high and rush from it, but they're always scrambling to make their next buck, and waiting to hit the big one.
A long term outlook and investing in a commodity itself is the foundation to success in commodity investing.
The next step is the research you do. It must be done on a continuous basis and the macro picture is the thing to be looked at.
By macro picture I mean the overall existing conditions that will determine whether prices of commodities will go up or down. Remember, you can make money in commodities whether the prices are going up or down. The secret is to look for movement, not what the direction of that movement is.
For example, if you're looking at investing in wheat, there could be drought in some regions of the world but a lot of rain in others. Either one could significantly impact the wheat harvest for any given time.
So in the short term, depending on which direction the weather is going, you could have some significant swing in wheat prices because of that.
But if you're looking at the long term, this won't be that big of a deal, as you're in it because of the demand and the ability to supply that demand.
If the demand is there, someone, somewhere, will find a way to meet that demand. It's as simple as that. You can have shortages because of a peculiar set of circumstances where the weather may disrupte wheat production in more than one important place. If that's the case, demand hasn't changed, but the supply could have. That will affect prices in the short term.
But again, it's the long term we're looking at for investing in commodities, and while those fluctuations will happen all the time, we must stay focused on demand and whether that is changing. If demand isn't changing, we can have a very accurate idea of the direction wheat prices will go in the long term future.
Just take whatever commodity you're thinking of investing in and apply these parameters to them. It takes more work with some commodities to research over others, because of the number of industrial uses they may have: for example silver, which is used in an increasing number of products, and so research must take into account demand across a number of product categories to get accurate information that action can be taken on.
Commodity Investing
Commodities are sometimes made to look far too complicated for the average investor, and so many stay away from what is one of the most exciting and potentially profitable wealth builders for the next couple decades.
I'm going to simplify it for you, and in reality, there is nothing more to it than what I'm about to explain.
The simplicity of commodity investing? It's completely related to supply and demand. Isn't that simple? It's nothing more than that.
Having said that, I'm talking about investing in raw commodities here, not businesses or mining companies that are dependent on the quality of management, labor issues, and a plethora of other issues.
If it's that simple, than why does it seem so complicated? Most of the complications, or perceived complications are in connection to market timers or day traders, who are attempting to make a quick killing and move out of the market.
A lot of media coverage of commodities is connected to this because if offers up drama that interests viewers, and gives something for the talking heads to communicate.
In reality, market timers don't make much money, and those investing for the short term never make the amount of money those with knowledge and in it for the long term do.
So the illusion is created that commodities are completely unpredictable, and investing in them is like gambling. Now if you're trying to time the market, that's not only true of commodities, but it's true of any investment vehicle. Short term investing is gambling, and those entering into may get a high and rush from it, but they're always scrambling to make their next buck, and waiting to hit the big one.
A long term outlook and investing in a commodity itself is the foundation to success in commodity investing.
The next step is the research you do. It must be done on a continuous basis and the macro picture is the thing to be looked at.
By macro picture I mean the overall existing conditions that will determine whether prices of commodities will go up or down. Remember, you can make money in commodities whether the prices are going up or down. The secret is to look for movement, not what the direction of that movement is.
For example, if you're looking at investing in wheat, there could be drought in some regions of the world but a lot of rain in others. Either one could significantly impact the wheat harvest for any given time.
So in the short term, depending on which direction the weather is going, you could have some significant swing in wheat prices because of that.
But if you're looking at the long term, this won't be that big of a deal, as you're in it because of the demand and the ability to supply that demand.
If the demand is there, someone, somewhere, will find a way to meet that demand. It's as simple as that. You can have shortages because of a peculiar set of circumstances where the weather may disrupte wheat production in more than one important place. If that's the case, demand hasn't changed, but the supply could have. That will affect prices in the short term.
But again, it's the long term we're looking at for investing in commodities, and while those fluctuations will happen all the time, we must stay focused on demand and whether that is changing. If demand isn't changing, we can have a very accurate idea of the direction wheat prices will go in the long term future.
Just take whatever commodity you're thinking of investing in and apply these parameters to them. It takes more work with some commodities to research over others, because of the number of industrial uses they may have: for example silver, which is used in an increasing number of products, and so research must take into account demand across a number of product categories to get accurate information that action can be taken on.
Commodity Investing
Thursday, February 5, 2009
Commodities: Trading Commodities
Just like in trading equities or any other investment, an investor without a long term outlook and time horizon will far underperform those that are in it for the longer term. Trading commodities is no different, as those going in and out of the market find themselves on the loosing end of deals, and wonder why other commodity futures traders are so successful while they linger on the sidelines licking their wounds.
It doesn't matter if it's trading currencies, agriculture futures or precious metals futures, it's all the same. Those measuring success in short term increments will find themselves never making any money, and only looking for someone to balme for their wrong decisions.
Commodities markets are no different than any other investment market, and we need to do our homework and have a solid handle on what commodity or commodities were investing in.
Whether its gold or silver futures, wheat or corn futures, or platinum or palladium futures, it's all the same. Understand what it is that relates to the underlying fundamentals and invest accordingly.
No matter what commodities exchange you're working with, commodities brokerage or broker, if you don't have a long term outlook and investigate the commodity or commodities you're interested in, you're going to fail miserably and not understand why.
Check out the commodity news and commoditey charts, look for patterns and changes in commodity demand and surplus. Look for any information on the commodity you're going to invest in, and make a decision on whether you want to invest in options or futures. You could in the case of ETFs of course go that route.
Commodity futures trading or commodity options trading isn't for the faint of heart, which is why it's even more important not to just throw your money at something hoping it will stick. If you don't have the time or are clueless, research commodity brokerages and individual commodity brokers to see which is the best fit for your desired strategy and risk tolerance. Also don't throw all your money into one commodity trade, as you could lose it all.
Over the long term, gold commodities, silver commodities, oil commodities look good for futures rising, while over the longer term a number of grain like wheat commodities, corn commodities and soybean commodities should perform well as middle classes grow in Asian countries.
Gas as a commodity investment should also do well over the long term.
The U.S. dollar is not a place you want to place your money, as over the long haul it's going to be under tremendous downward pressure, and other currencies would be better to invest in if you're interested in the currency sector.
Commodity funds, commodity investments, commodity indexes, commodity stocks, commodity exchanges, ETFs, commodities prices and so on, are going to rise, and will outperform in general all other investment vehicles and sectors over the next five to ten years. There will obviously be individual commodities that won't partake in that success, which is why learning to be a futures trader or options trader and understanding the overall commodity market in relationship to supply and demand is so important.
Taking a consistent look at gold as a commodity people are looking to park their money safely, as well as the commodity silver is a must going forward. Both of those should do well in the near and long term.
Commodities will continue to be hot, and those who prepare and are ready and willing to take the risk, should experience extraordinary success in commodity options, futures, funds and ETFs in the near and long term.
It doesn't matter if it's trading currencies, agriculture futures or precious metals futures, it's all the same. Those measuring success in short term increments will find themselves never making any money, and only looking for someone to balme for their wrong decisions.
Commodities markets are no different than any other investment market, and we need to do our homework and have a solid handle on what commodity or commodities were investing in.
Whether its gold or silver futures, wheat or corn futures, or platinum or palladium futures, it's all the same. Understand what it is that relates to the underlying fundamentals and invest accordingly.
No matter what commodities exchange you're working with, commodities brokerage or broker, if you don't have a long term outlook and investigate the commodity or commodities you're interested in, you're going to fail miserably and not understand why.
Check out the commodity news and commoditey charts, look for patterns and changes in commodity demand and surplus. Look for any information on the commodity you're going to invest in, and make a decision on whether you want to invest in options or futures. You could in the case of ETFs of course go that route.
Commodity futures trading or commodity options trading isn't for the faint of heart, which is why it's even more important not to just throw your money at something hoping it will stick. If you don't have the time or are clueless, research commodity brokerages and individual commodity brokers to see which is the best fit for your desired strategy and risk tolerance. Also don't throw all your money into one commodity trade, as you could lose it all.
Over the long term, gold commodities, silver commodities, oil commodities look good for futures rising, while over the longer term a number of grain like wheat commodities, corn commodities and soybean commodities should perform well as middle classes grow in Asian countries.
Gas as a commodity investment should also do well over the long term.
The U.S. dollar is not a place you want to place your money, as over the long haul it's going to be under tremendous downward pressure, and other currencies would be better to invest in if you're interested in the currency sector.
Commodity funds, commodity investments, commodity indexes, commodity stocks, commodity exchanges, ETFs, commodities prices and so on, are going to rise, and will outperform in general all other investment vehicles and sectors over the next five to ten years. There will obviously be individual commodities that won't partake in that success, which is why learning to be a futures trader or options trader and understanding the overall commodity market in relationship to supply and demand is so important.
Taking a consistent look at gold as a commodity people are looking to park their money safely, as well as the commodity silver is a must going forward. Both of those should do well in the near and long term.
Commodities will continue to be hot, and those who prepare and are ready and willing to take the risk, should experience extraordinary success in commodity options, futures, funds and ETFs in the near and long term.
Tuesday, February 3, 2009
Commodity Futures and Fortunes
Commodities are going to be increasingly important in the years ahead; both as a hedge and as an investment. No matter what happens in the world, people will need raw materials and food, and that means the growing middle class in China and India, as well as other Asian countries, will drive a lot of the commodity futures prices in the short and long term.
That means that gold futures, oil futures, sivler futures, and commodities and futures of all sorts will be extremely profitable for those that do their homework and are patient in their commodities investments.
While there will always be commodities speculators in the market, those that are investing in commodity futures to make predictable profits, are those that have a long term outlook, which eliminates much of the price fluctuation connected to commodity futures and options coming from those speculators moving in and out of the markets.
Those investing in commodities in the short term run much higher risk than those looking at the long haul, just like those investing in equities. Commodity futures and options over the long term in the current global market have a more predictable pattern than maybe any other time in futures trading, because of the booming Asian markets which will need many things that it can now afford, in contrast to the past when the need was there but not the means.
Also benefitting now and in the future will be commodity futures brokers who will be increasingly looked to for advice in the realitively unknown area for most commodities trader wannabees.
Another potential beneficiary will be those in business who depend on trading in commodity futures to ensure they get their raw materials to operate their business, as well as lock in a price they can count on in the future.
While that could obviously backfire in the sense that the price could be less in the future than the commodity futures trader wanted, it still guarantees they'll receive their shipment if supply drops in relationship to demand, which the future pretty much guarantees.
If I was a commodity broker, I would be putting together some training or lessons that potential commodities investors just entering the market would find easy to understand. People overall don't understand commodity options and futures, so those commodity brokers ready and able to make it easy and simple to understand, will gain a lot of the upcoming commodity trading business that wasn't there before.
In other words, there's going to be a lot of new investors wanting and needing to learn how to trade commodities. The futures brokers ready for them will do a ton of new commodity futures and options business, and will do their clients a great service.
It seems most commodity futures brokers should be ready to explain the value of having a long term outlook concerning their futures contracts, and that the various forces that can impact prices make that a necessity for success over the long haul.
Those new to investing in commodities will need to understand that everything from weather, acreage, demand, scarcity and politics all play a role in determing upward or downward price movement in commodity prices.
With the U.S. dollar also ready to start plunging, it would be smart for futures brokers to be ready to put their clients' money into currencies that are ready to move upwards against the dollar, as well as into gold futures which will assuredly skyrocket going forward. Silver futures and oil futures should also enjoy upward movement for some time.
So looking ahead, those businesses, brokers, investors and farmers connected to commodities should enjoy unprecedented prosperity. Like anything else though, those best prepared and who have done their homework will be the most profitable in the ongoing commodity bull market.
Whether it be oil or gas futures; gold and silver or other precious metals; grains or livestock; currencies like the yen or yuan; or if commodity trades are done on the internet or whether you're a broker, farmer, or investor, those participating in trading in commodity options and futures from whatever side of the sector, should be wildly successful and build significant wealth and fortunes.
Commodity investing and futures trading demands discipline and courage, as well as doing your homework. No matter what part you play in the overall field, be ready for the raging commodity bull market about to ramp up again, as the raising middle classes in Asian countries look to raise their standard of living by the increasing demand they're able to afford.
From mining companies, farmers, business owners and countries, those best prepared and ready to run will enjoy extraordinary success as demand for raw materials is the largest it has ever been in the history of the world.
So we need to be prepared from whatever place we're in in relationship to investing in commodity futures and options, and watch as commodity prices surge as unprecedented demand carries everyone to heights they never imagined.
Those with long term outlooks and prepared for the upcoming period of time will be those benefitting most from the trading of commodities, including the commodity brokerages, brokers and businesses hedging their bets and locking in predictable prices and product they can make future plans with.
Commodities traders and investors will be the largest group of the wealthy in the years ahead, and will out perform all other financial sectors overall. Commodity prices will rise, and so will the wealth of those having the guts to grab the future which is assuredly coming.
That means that gold futures, oil futures, sivler futures, and commodities and futures of all sorts will be extremely profitable for those that do their homework and are patient in their commodities investments.
While there will always be commodities speculators in the market, those that are investing in commodity futures to make predictable profits, are those that have a long term outlook, which eliminates much of the price fluctuation connected to commodity futures and options coming from those speculators moving in and out of the markets.
Those investing in commodities in the short term run much higher risk than those looking at the long haul, just like those investing in equities. Commodity futures and options over the long term in the current global market have a more predictable pattern than maybe any other time in futures trading, because of the booming Asian markets which will need many things that it can now afford, in contrast to the past when the need was there but not the means.
Also benefitting now and in the future will be commodity futures brokers who will be increasingly looked to for advice in the realitively unknown area for most commodities trader wannabees.
Another potential beneficiary will be those in business who depend on trading in commodity futures to ensure they get their raw materials to operate their business, as well as lock in a price they can count on in the future.
While that could obviously backfire in the sense that the price could be less in the future than the commodity futures trader wanted, it still guarantees they'll receive their shipment if supply drops in relationship to demand, which the future pretty much guarantees.
If I was a commodity broker, I would be putting together some training or lessons that potential commodities investors just entering the market would find easy to understand. People overall don't understand commodity options and futures, so those commodity brokers ready and able to make it easy and simple to understand, will gain a lot of the upcoming commodity trading business that wasn't there before.
In other words, there's going to be a lot of new investors wanting and needing to learn how to trade commodities. The futures brokers ready for them will do a ton of new commodity futures and options business, and will do their clients a great service.
It seems most commodity futures brokers should be ready to explain the value of having a long term outlook concerning their futures contracts, and that the various forces that can impact prices make that a necessity for success over the long haul.
Those new to investing in commodities will need to understand that everything from weather, acreage, demand, scarcity and politics all play a role in determing upward or downward price movement in commodity prices.
With the U.S. dollar also ready to start plunging, it would be smart for futures brokers to be ready to put their clients' money into currencies that are ready to move upwards against the dollar, as well as into gold futures which will assuredly skyrocket going forward. Silver futures and oil futures should also enjoy upward movement for some time.
So looking ahead, those businesses, brokers, investors and farmers connected to commodities should enjoy unprecedented prosperity. Like anything else though, those best prepared and who have done their homework will be the most profitable in the ongoing commodity bull market.
Whether it be oil or gas futures; gold and silver or other precious metals; grains or livestock; currencies like the yen or yuan; or if commodity trades are done on the internet or whether you're a broker, farmer, or investor, those participating in trading in commodity options and futures from whatever side of the sector, should be wildly successful and build significant wealth and fortunes.
Commodity investing and futures trading demands discipline and courage, as well as doing your homework. No matter what part you play in the overall field, be ready for the raging commodity bull market about to ramp up again, as the raising middle classes in Asian countries look to raise their standard of living by the increasing demand they're able to afford.
From mining companies, farmers, business owners and countries, those best prepared and ready to run will enjoy extraordinary success as demand for raw materials is the largest it has ever been in the history of the world.
So we need to be prepared from whatever place we're in in relationship to investing in commodity futures and options, and watch as commodity prices surge as unprecedented demand carries everyone to heights they never imagined.
Those with long term outlooks and prepared for the upcoming period of time will be those benefitting most from the trading of commodities, including the commodity brokerages, brokers and businesses hedging their bets and locking in predictable prices and product they can make future plans with.
Commodities traders and investors will be the largest group of the wealthy in the years ahead, and will out perform all other financial sectors overall. Commodity prices will rise, and so will the wealth of those having the guts to grab the future which is assuredly coming.
Tuesday, December 9, 2008
Examine the Indian Commodities Trading Market
NEW YORK, Dec 09, 2008 (BUSINESS WIRE) -- Reportlinker.com announces that a new market research report related to the Energy industry is available in its catalogue.
Indian Commodities Trading Market
Turmoil in financial markets, slower growth in high-income countries, and rising inflation have all adversely affected growth prospects for developing countries over the near term. Most countries have shown impressive resilience in this turbulent environment, and growth for developing countries as a group is expected to moderate from 7.8% in 2007 to a still strong 6.5% in 2008. However, vulnerable countries that depend on foreign capital flows are likely to experience a sharper slowdown. Moreover, despite strong production growth at the aggregate level, higher food and energy prices have caused real incomes to decline, significantly increasing the hardships faced by the very poor, particularly in urban centers.
A recent article in the Wall Street Journal noted that if one were to examine the historical performance of the S&P 500, one would find that the stock market is trading at the same level at which it was doing so nine years ago. Commodities markets, on the other hand, have been in a bull trend. Some of the major drivers that have contributed in this stupendous growth of commodity markets globally are - Increasing influence of Asian demand, particularly from rapidly industrializing China and India - Increase in commodities prices in international markets as a result of demand growth, reinforced by tight supply capacities, tense geopolitical conditions (especially with respect to the oil market) and intense speculative activity - With the rise in prices of crude oil, metals and minerals, commodity prices reached record historical levels in nominal terms in 2006, which increased by more than 30% between 2005 and 2006 (and by 80% from 2000 to 2006). - Numerous developing countries rely on commodities for export revenues, and commodity production and trade provide employment for more than 2.5 billion people worldwide. - The considerable rise in prices has had an impact on incomes of developing countries. It is estimated that extra revenues resulting from commodity exports were around 6.7 percentage points of GDP for oil-exporting countries and about 3 percentage points for countries exporting mining products.
Increases in demand from developing countries stimulated by a particularly vigorous commodity consumption per unit of GDP compared to that of developed countries, faster economic growth, and increasing population - Globalization of securities and commodities markets - Baby boomers are in the middle of their peak savings years and have been one of the major causes of huge inflows of money into the stock market and into mutual funds. - The increased use of food crops for production of bio-fuels is an important factor that led to large increases in the prices of vegetable oils and grains in 2007, which in turn contributed to an overall 15 percent increase in the index of agricultural prices and a 20 percent rise in food prices. - The prices of metals have increased more than other commodity prices over the last four years, largely because of an especially strong demand in China. - Shortages of equipment and skilled workers have significantly increased development costs, and ore grades are deteriorating.
The report on "Indian Commodities Trading Market" by 'The Knowledge Centre' offers an in-depth analysis of the Global Commodities Trading Market vis-a-vis the Indian Commodities Trading Market. It discusses the overall structure of the Global Commodities Market as well as Indian Commodities Market from an insider perspective and provides a comprehensive study on macro and micro factors driving the growth of this market.
The report furnishes up-to-date facts and figures following meticulous observation with an aim to provide you with real insights into the commodity trading market as it stands today; the knowledge one needs to stand out and make informed decisions. The expanse of such insights into the past and present scenario percolates down to every known commodity currently traded. A conscious effort has been made to provide an overview of all there is to know and know of in the volatile market whilst a detailed product-wise and segment-wise is used in conjunction to expand. Taking into account that Price and Risk being the key drivers of the market, the report presents an exclusive section which maps price growth trend behaviour, factors triggering such behaviour, tracking relative performance of commodities , effects on the market players directly or indirectly using composite indexes from leading sources, the use of various hedging tools such as forwards and options and the relative performance in comparison, the implication and significance of the various regulatory bodies, commissions and statutory acts to highlight a few.
Section I: Commodities Trading - An Overview
1. How Commodities Market Evolved - Historical Perspective
2. How Commodities Trading Market Works 2.1 Involved Parties 2.2 Types of Contracts 2.3 Participants in derivative contracts 2.4 Trading Techniques in Commodities Market 2.4.1 Ready Delivery Market 2.4.2 Specific Delivery Market 2.4.3 Futures Market 2.4.4 Auction Market 2.5 Requirement & Benefits of Commodity Derivatives
Section II: Commodities Market - An Analysis
1. Global Commodities Market - An Overview 1.1 Commodities Trading vis-a-vis Role of Investment Banks 1.1.1 Barclays Capital Commodities - Profile 1.1.2 BNP Paribas Commodity Futures - Profile 1.1.3 Citi Global Commodities - Profile 1.1.4 DB Commodity Services LLC - Profile 1.1.5 Goldman Sachs Commodities - Profile 1.1.6 J.P. Morgan's Global Commodities Group - Profile 1.1.7 Merrill Lynch Global Commodities (MLCI) - Profile 1.1.8 UBS's Commodities Group 1.2 Energy Trading vis-a-vis Energy Trading In-house Divisions 1.2.1 RBS Sempra Commodities 1.2.2 Chevron's Supply & Trading 1.2.3 LITASCO (LUKOIL International Trading and Supply Company) 1.2.4 Koch Supply & Trading 1.2.5 AEP Energy Services (Subsidiary of American Electric Power Company, Inc.) 1.2.6 Duke Energy Trading and Marketing (DETM) 1.2.7 Shell Trading (US) Company 1.2.8 Reliant Energy Securities & Commodities Trading Center 1.3 Commodity ETFs and ETNs 1.4 Commodity Trading vis-a-vis Sovereign Wealth Funds (SWFs) 1.4.1 History of SWFs 1.4.2 Driving Factors, Issues, Trends & Opportunities 1.4.3 Sources of Capital 1.4.4 How & where the money is invested - Market Size & Projections 1.4.5 Fund Rankings: Largest Funds by Assets under Management
2. Global Commodities Market Analysis 2.1 Global Commodities Market Size & Forecast 2.2 Commodity Market Profiles - Quick Points (Profile, Producers, Consumers, Largest Markets, Price Performance & Top Companies) 2.2.1 Aluminium Market 2.2.2 Cocoa Market 2.2.3 Coffee Market 2.2.4 Copper Market 2.2.5 Cotton Market 2.2.6 Gold Market 2.2.7 Nickel Market 2.3 Global Commodities Indexes - Performance Analysis 2.3.1 Dow Jones - AIG Commodity Indices 2.3.2 Merrill Lynch Commodity index eXtra (MLCX) 2.3.3 S&P GSCI(TM) Composite Index 2.3.4 Reuters/Jefferies-CRB(R) Indices
3. Issues, Trends & Opportunities 3.1 Impact of higher commodity prices 3.2 Movement of oil prices 3.3 Performance of agriculture commodities 3.4 Companies turn to top derivatives dealers for help in hedging 3.5 Carbon to be the biggest global commodity market by 2012 3.6 Renewed interest from investors 3.7 More sophisticated tools & platforms 3.8 Investment banks are major players 3.9 ETFs, changing the equation of Commodities Investment 3.10 China - Major Demand Driver of Global Commodities 3.11 Macro-Economic Driving Factors 3.12 Factors affecting pricing of base metals 3.12.1 Lead (75% y-o-y growth) 3.12.2 Tin (66% y-o-y growth) 3.12.3 Zinc (40% y-o-y decline) 3.12.4 Nickel (4% y-o-y decline)
Section III: Indian Commodities Trading Market
1. Indian Commodities Market - An Overview
2. Indian Commodities Market Size - An Analysis 2.1 MCX vs. SENSEX - A Comparative Analysis
3. Indian Commodities Market - Performance Analysis 3.1 Aluminium Market - Future Contract Value (Jan 07 - Jul 08) 3.2 Coffee Market - Robusta Futures Contract Value (Jan 07 - Aug 08) 3.3 Copper Market - Copper Futures Contract Value (Jan 07 - Jul 08) 3.5 Crude Oil Market - Crude Oil Futures Contract Value (Jan 07 - Aug 08) 3.6 Gold Market - Futures Contract Value (Jan 07 - Aug 08) 3.7 Chana (Chickpea) Market - Futures Contract Value (Jan 07 - May 08) 3.8 Nickel Market - Futures Contract Value (Jan 07 - Jul 08) 3.9 Zinc Market - Futures Contract Value (Jan 07 - Jul 08) 3.10 Lead Market - Price Performance (Jan 07 - Aug 08) 3.11 Cardamom Market - Futures Contract Value (Jan 07 - Jul 08) 3.12 Jeera (Cumin Seed) Market - Futures Contract Value (Jan 07 - Jul 08) 3.13 Lead Market - Futures Contract Value (Jan 07 - Jul 08) 3.14 Mentha Oil Market - Futures Contract Value (Jan 07 - Jul 08) 3.15 Natural Gas Market - Futures Contract Value (Jan 07 - Jul 08)
4. Government Regulations, Initiatives and Reforms 4.1 Setting up a Committee on Role of Futures Trading in 1993 4.2 Setting up of Forward Market Commission in 1953 4.3 Forward Contracts (Regulation) Act, 1952 4.4 Forward Contracts (Regulation) Amendment Bill, 2006 4.5 Forward Contracts (Regulation) Amendment Ordinance, 2008 4.6 Commodities Trading Tax 4.7 Import duty cut & export duty hike in Metals industry
5. Issues, Trends & Opportunities 5.1 Commodity Trends: Hurt by economic slowdown 5.2 Multi Commodity Exchange (MCX) launched currency futures trading 5.2 Hedging ban a slow political process to kill futures market 5.3 Commodity investment goes retail 5.4 Unresolved Issues and Future Prospects 5.5 Scrap now being considered a waste commodity 5.6 Commodity and Equity Markets have been moving in tandem 5.7 Indian Bt Cotton to hit market soon 5.8 Warehousing to take giant leap in India
List of Charts
Chart 1: Mode of Financing in Commodities Trading Chart 2: Business Operations Model of a Trading Process in a Commodity Exchange Chart 3: SWFs Market Projections (2007-2012) Chart 4: Comparison of AUM of SWFs and Asset Managers, Private Equity and Hedge Funds ($ billions) Chart 5: Sovereign Wealth Fund Deal Volume (1997-2007) Chart 6: Sector-wise growth: Exchange trade of commodity derivatives by volume (03-06) Chart 7: World's leading Commodity Exchanges in developing countries - 2006 Contracts ($millions) Chart 8: Major base metal commodity exchanges & emerging markets Chart 9: Base Metal Price Trend - 2006 vs. Present Price Chart 10: Cocoa Monthly Averages of Daily Prices (Oct 07- Oct 08) Chart 11: ICO Indicator Prices - Annual & Monthly Averages (1998 to 2008) Chart 12: Global Cotton Average Price Trend (`A` Index (cents/pound)) - 1988 -2008 Chart 13: Merrill Lynch Commodity index eXtra (MLCX) - Commodity Weightings Chart 14: MLCX Weights as of January 2008 Chart 15: MLCXTR outperformance vs. SPGCCITR & DJAIGTR Chart 16: Reuters/Jefferies CRB(R) Total Return Index: Jan 82 - Sep 08 (monthly close) Chart 17: Forecast of China's Share of the Growth in Demand for Global Commodities- 2009 Chart 18: Types of Commodities Traded in India Chart 19: MCX vs. SENSEX - Comparative Analysis (Jan 06-Sep 08) Chart 20: India's Aluminium Futures Contract in Value (Rs. Crore) (Jan 07 - Jul 08) Chart 21: India's Coffee Robusta Futures Contract in Value (Rs. Lakhs) (Jan 07 - Aug 08) Chart 22: India's Copper Futures Contract in Value (Rs. Crore) Chart 23: India's Crude Oil Futures Contract in Value (Rs. Crore) Chart 24: India's Gold (1Kg) Futures Contract in Value (Rs. Crore) Chart 25: India's Gold (100g) Futures contract in Value (Rs. Crore) Chart 26: India's Chana (Chickpea) Futures Contract in Value (Rs. Crore) Chart 27: India's Nickel Futures Contract in Value (Rs. Crore) Chart 28: India's Zinc Futures Contract in Value (Rs. Crore) Chart 29: India's Lead Futures Contract in Value (Rs. Crore) Chart 30: India's Cardamom Futures Contract in Value (Rs. Crore) Chart 31: India's Jeera (Cumin Seed) Futures Contract in Value (Rs. Lakhs) Chart 32: India's Lead Futures Contract in Value (Rs. Crore) Chart 33: India's Mentha Oil Futures Contract in Value (Rs. Crore) Chart 34: India's Natural Gas Futures Contract in Value (Rs. Crore)
List of Tables
Table 1: The Global Economic Outlook (2006-2010)
Table 2: Major Global Commodity Exchanges
Table 3: Major Asian Commodity Exchanges
Table 4: Major European Commodity Exchanges
Table 5: Commodity Traders - List of top banks, Financial Institutions & other top companies
Table 6: Fund Rankings: Largest Funds by Assets under Management
Table 7: Global Commodity Prices - Monthly & Yearly Averages (Jan 06 - Sep 08)
Table 8: Commodity Forecast Nominal Prices (2007-2020)
Table 9: World Cocoa Market Estimates (in million metric tons) - 2002-2008
Table 10: ICO Indicator Prices - Annual & Monthly Averages (1998 to 2008)
Table 11: Global Cotton Average Price Trend (`A` Index (cents/pound)) - 1988 -2008
Table 12: Comparison of Commodity Indexes
Table 13: Dow Jones AIG Total Return Performance %
Table 14: Dow Jones AIG Excess Return Performance %
Table 15: Dow Jones AIG Yearly Returns (1990-2008)
Table 16: DJGI AIG Commodity Index - Commodity Weightings
Table 17: Merrill Lynch Commodity index eXtra (MLCX) - Commodity Weightings
Table 18: S&P GSCI(TM) Components and Dollar Weights (%)
Table 19: S&P GSCI(TM) Index Values
Table 20: Commodity Exchanges in India
Table 21: Trend of Commodities in National Commodity & Derivatives Exchange (Oct 08)
Table 22: Trend of Commodities in Multi Commodity Exchange of India (Oct 08)
Table 23: Trend of Metals in Multi Commodity Exchange of India (MCX) and National Commodity & Derivatives Exchange (NCDEX) (Oct 08)
Table 24: Trend of Oil Commodities traded in NYMEX (Oct 08)
Table 25: Trend of Metal commodities traded in NYMEX (Oct 08)
To order this report: Indian Commodities Trading Market
More market research reports here!
SOURCE: ReportLinker
Reportlinker
Nicolas: nbo@reportlinker.com
US: (805)-652-2626
Intl: +1 805-652-2626
Copyright Business Wire 2008
Indian Commodities Trading Market
Turmoil in financial markets, slower growth in high-income countries, and rising inflation have all adversely affected growth prospects for developing countries over the near term. Most countries have shown impressive resilience in this turbulent environment, and growth for developing countries as a group is expected to moderate from 7.8% in 2007 to a still strong 6.5% in 2008. However, vulnerable countries that depend on foreign capital flows are likely to experience a sharper slowdown. Moreover, despite strong production growth at the aggregate level, higher food and energy prices have caused real incomes to decline, significantly increasing the hardships faced by the very poor, particularly in urban centers.
A recent article in the Wall Street Journal noted that if one were to examine the historical performance of the S&P 500, one would find that the stock market is trading at the same level at which it was doing so nine years ago. Commodities markets, on the other hand, have been in a bull trend. Some of the major drivers that have contributed in this stupendous growth of commodity markets globally are - Increasing influence of Asian demand, particularly from rapidly industrializing China and India - Increase in commodities prices in international markets as a result of demand growth, reinforced by tight supply capacities, tense geopolitical conditions (especially with respect to the oil market) and intense speculative activity - With the rise in prices of crude oil, metals and minerals, commodity prices reached record historical levels in nominal terms in 2006, which increased by more than 30% between 2005 and 2006 (and by 80% from 2000 to 2006). - Numerous developing countries rely on commodities for export revenues, and commodity production and trade provide employment for more than 2.5 billion people worldwide. - The considerable rise in prices has had an impact on incomes of developing countries. It is estimated that extra revenues resulting from commodity exports were around 6.7 percentage points of GDP for oil-exporting countries and about 3 percentage points for countries exporting mining products.
Increases in demand from developing countries stimulated by a particularly vigorous commodity consumption per unit of GDP compared to that of developed countries, faster economic growth, and increasing population - Globalization of securities and commodities markets - Baby boomers are in the middle of their peak savings years and have been one of the major causes of huge inflows of money into the stock market and into mutual funds. - The increased use of food crops for production of bio-fuels is an important factor that led to large increases in the prices of vegetable oils and grains in 2007, which in turn contributed to an overall 15 percent increase in the index of agricultural prices and a 20 percent rise in food prices. - The prices of metals have increased more than other commodity prices over the last four years, largely because of an especially strong demand in China. - Shortages of equipment and skilled workers have significantly increased development costs, and ore grades are deteriorating.
The report on "Indian Commodities Trading Market" by 'The Knowledge Centre' offers an in-depth analysis of the Global Commodities Trading Market vis-a-vis the Indian Commodities Trading Market. It discusses the overall structure of the Global Commodities Market as well as Indian Commodities Market from an insider perspective and provides a comprehensive study on macro and micro factors driving the growth of this market.
The report furnishes up-to-date facts and figures following meticulous observation with an aim to provide you with real insights into the commodity trading market as it stands today; the knowledge one needs to stand out and make informed decisions. The expanse of such insights into the past and present scenario percolates down to every known commodity currently traded. A conscious effort has been made to provide an overview of all there is to know and know of in the volatile market whilst a detailed product-wise and segment-wise is used in conjunction to expand. Taking into account that Price and Risk being the key drivers of the market, the report presents an exclusive section which maps price growth trend behaviour, factors triggering such behaviour, tracking relative performance of commodities , effects on the market players directly or indirectly using composite indexes from leading sources, the use of various hedging tools such as forwards and options and the relative performance in comparison, the implication and significance of the various regulatory bodies, commissions and statutory acts to highlight a few.
Section I: Commodities Trading - An Overview
1. How Commodities Market Evolved - Historical Perspective
2. How Commodities Trading Market Works 2.1 Involved Parties 2.2 Types of Contracts 2.3 Participants in derivative contracts 2.4 Trading Techniques in Commodities Market 2.4.1 Ready Delivery Market 2.4.2 Specific Delivery Market 2.4.3 Futures Market 2.4.4 Auction Market 2.5 Requirement & Benefits of Commodity Derivatives
Section II: Commodities Market - An Analysis
1. Global Commodities Market - An Overview 1.1 Commodities Trading vis-a-vis Role of Investment Banks 1.1.1 Barclays Capital Commodities - Profile 1.1.2 BNP Paribas Commodity Futures - Profile 1.1.3 Citi Global Commodities - Profile 1.1.4 DB Commodity Services LLC - Profile 1.1.5 Goldman Sachs Commodities - Profile 1.1.6 J.P. Morgan's Global Commodities Group - Profile 1.1.7 Merrill Lynch Global Commodities (MLCI) - Profile 1.1.8 UBS's Commodities Group 1.2 Energy Trading vis-a-vis Energy Trading In-house Divisions 1.2.1 RBS Sempra Commodities 1.2.2 Chevron's Supply & Trading 1.2.3 LITASCO (LUKOIL International Trading and Supply Company) 1.2.4 Koch Supply & Trading 1.2.5 AEP Energy Services (Subsidiary of American Electric Power Company, Inc.) 1.2.6 Duke Energy Trading and Marketing (DETM) 1.2.7 Shell Trading (US) Company 1.2.8 Reliant Energy Securities & Commodities Trading Center 1.3 Commodity ETFs and ETNs 1.4 Commodity Trading vis-a-vis Sovereign Wealth Funds (SWFs) 1.4.1 History of SWFs 1.4.2 Driving Factors, Issues, Trends & Opportunities 1.4.3 Sources of Capital 1.4.4 How & where the money is invested - Market Size & Projections 1.4.5 Fund Rankings: Largest Funds by Assets under Management
2. Global Commodities Market Analysis 2.1 Global Commodities Market Size & Forecast 2.2 Commodity Market Profiles - Quick Points (Profile, Producers, Consumers, Largest Markets, Price Performance & Top Companies) 2.2.1 Aluminium Market 2.2.2 Cocoa Market 2.2.3 Coffee Market 2.2.4 Copper Market 2.2.5 Cotton Market 2.2.6 Gold Market 2.2.7 Nickel Market 2.3 Global Commodities Indexes - Performance Analysis 2.3.1 Dow Jones - AIG Commodity Indices 2.3.2 Merrill Lynch Commodity index eXtra (MLCX) 2.3.3 S&P GSCI(TM) Composite Index 2.3.4 Reuters/Jefferies-CRB(R) Indices
3. Issues, Trends & Opportunities 3.1 Impact of higher commodity prices 3.2 Movement of oil prices 3.3 Performance of agriculture commodities 3.4 Companies turn to top derivatives dealers for help in hedging 3.5 Carbon to be the biggest global commodity market by 2012 3.6 Renewed interest from investors 3.7 More sophisticated tools & platforms 3.8 Investment banks are major players 3.9 ETFs, changing the equation of Commodities Investment 3.10 China - Major Demand Driver of Global Commodities 3.11 Macro-Economic Driving Factors 3.12 Factors affecting pricing of base metals 3.12.1 Lead (75% y-o-y growth) 3.12.2 Tin (66% y-o-y growth) 3.12.3 Zinc (40% y-o-y decline) 3.12.4 Nickel (4% y-o-y decline)
Section III: Indian Commodities Trading Market
1. Indian Commodities Market - An Overview
2. Indian Commodities Market Size - An Analysis 2.1 MCX vs. SENSEX - A Comparative Analysis
3. Indian Commodities Market - Performance Analysis 3.1 Aluminium Market - Future Contract Value (Jan 07 - Jul 08) 3.2 Coffee Market - Robusta Futures Contract Value (Jan 07 - Aug 08) 3.3 Copper Market - Copper Futures Contract Value (Jan 07 - Jul 08) 3.5 Crude Oil Market - Crude Oil Futures Contract Value (Jan 07 - Aug 08) 3.6 Gold Market - Futures Contract Value (Jan 07 - Aug 08) 3.7 Chana (Chickpea) Market - Futures Contract Value (Jan 07 - May 08) 3.8 Nickel Market - Futures Contract Value (Jan 07 - Jul 08) 3.9 Zinc Market - Futures Contract Value (Jan 07 - Jul 08) 3.10 Lead Market - Price Performance (Jan 07 - Aug 08) 3.11 Cardamom Market - Futures Contract Value (Jan 07 - Jul 08) 3.12 Jeera (Cumin Seed) Market - Futures Contract Value (Jan 07 - Jul 08) 3.13 Lead Market - Futures Contract Value (Jan 07 - Jul 08) 3.14 Mentha Oil Market - Futures Contract Value (Jan 07 - Jul 08) 3.15 Natural Gas Market - Futures Contract Value (Jan 07 - Jul 08)
4. Government Regulations, Initiatives and Reforms 4.1 Setting up a Committee on Role of Futures Trading in 1993 4.2 Setting up of Forward Market Commission in 1953 4.3 Forward Contracts (Regulation) Act, 1952 4.4 Forward Contracts (Regulation) Amendment Bill, 2006 4.5 Forward Contracts (Regulation) Amendment Ordinance, 2008 4.6 Commodities Trading Tax 4.7 Import duty cut & export duty hike in Metals industry
5. Issues, Trends & Opportunities 5.1 Commodity Trends: Hurt by economic slowdown 5.2 Multi Commodity Exchange (MCX) launched currency futures trading 5.2 Hedging ban a slow political process to kill futures market 5.3 Commodity investment goes retail 5.4 Unresolved Issues and Future Prospects 5.5 Scrap now being considered a waste commodity 5.6 Commodity and Equity Markets have been moving in tandem 5.7 Indian Bt Cotton to hit market soon 5.8 Warehousing to take giant leap in India
List of Charts
Chart 1: Mode of Financing in Commodities Trading Chart 2: Business Operations Model of a Trading Process in a Commodity Exchange Chart 3: SWFs Market Projections (2007-2012) Chart 4: Comparison of AUM of SWFs and Asset Managers, Private Equity and Hedge Funds ($ billions) Chart 5: Sovereign Wealth Fund Deal Volume (1997-2007) Chart 6: Sector-wise growth: Exchange trade of commodity derivatives by volume (03-06) Chart 7: World's leading Commodity Exchanges in developing countries - 2006 Contracts ($millions) Chart 8: Major base metal commodity exchanges & emerging markets Chart 9: Base Metal Price Trend - 2006 vs. Present Price Chart 10: Cocoa Monthly Averages of Daily Prices (Oct 07- Oct 08) Chart 11: ICO Indicator Prices - Annual & Monthly Averages (1998 to 2008) Chart 12: Global Cotton Average Price Trend (`A` Index (cents/pound)) - 1988 -2008 Chart 13: Merrill Lynch Commodity index eXtra (MLCX) - Commodity Weightings Chart 14: MLCX Weights as of January 2008 Chart 15: MLCXTR outperformance vs. SPGCCITR & DJAIGTR Chart 16: Reuters/Jefferies CRB(R) Total Return Index: Jan 82 - Sep 08 (monthly close) Chart 17: Forecast of China's Share of the Growth in Demand for Global Commodities- 2009 Chart 18: Types of Commodities Traded in India Chart 19: MCX vs. SENSEX - Comparative Analysis (Jan 06-Sep 08) Chart 20: India's Aluminium Futures Contract in Value (Rs. Crore) (Jan 07 - Jul 08) Chart 21: India's Coffee Robusta Futures Contract in Value (Rs. Lakhs) (Jan 07 - Aug 08) Chart 22: India's Copper Futures Contract in Value (Rs. Crore) Chart 23: India's Crude Oil Futures Contract in Value (Rs. Crore) Chart 24: India's Gold (1Kg) Futures Contract in Value (Rs. Crore) Chart 25: India's Gold (100g) Futures contract in Value (Rs. Crore) Chart 26: India's Chana (Chickpea) Futures Contract in Value (Rs. Crore) Chart 27: India's Nickel Futures Contract in Value (Rs. Crore) Chart 28: India's Zinc Futures Contract in Value (Rs. Crore) Chart 29: India's Lead Futures Contract in Value (Rs. Crore) Chart 30: India's Cardamom Futures Contract in Value (Rs. Crore) Chart 31: India's Jeera (Cumin Seed) Futures Contract in Value (Rs. Lakhs) Chart 32: India's Lead Futures Contract in Value (Rs. Crore) Chart 33: India's Mentha Oil Futures Contract in Value (Rs. Crore) Chart 34: India's Natural Gas Futures Contract in Value (Rs. Crore)
List of Tables
Table 1: The Global Economic Outlook (2006-2010)
Table 2: Major Global Commodity Exchanges
Table 3: Major Asian Commodity Exchanges
Table 4: Major European Commodity Exchanges
Table 5: Commodity Traders - List of top banks, Financial Institutions & other top companies
Table 6: Fund Rankings: Largest Funds by Assets under Management
Table 7: Global Commodity Prices - Monthly & Yearly Averages (Jan 06 - Sep 08)
Table 8: Commodity Forecast Nominal Prices (2007-2020)
Table 9: World Cocoa Market Estimates (in million metric tons) - 2002-2008
Table 10: ICO Indicator Prices - Annual & Monthly Averages (1998 to 2008)
Table 11: Global Cotton Average Price Trend (`A` Index (cents/pound)) - 1988 -2008
Table 12: Comparison of Commodity Indexes
Table 13: Dow Jones AIG Total Return Performance %
Table 14: Dow Jones AIG Excess Return Performance %
Table 15: Dow Jones AIG Yearly Returns (1990-2008)
Table 16: DJGI AIG Commodity Index - Commodity Weightings
Table 17: Merrill Lynch Commodity index eXtra (MLCX) - Commodity Weightings
Table 18: S&P GSCI(TM) Components and Dollar Weights (%)
Table 19: S&P GSCI(TM) Index Values
Table 20: Commodity Exchanges in India
Table 21: Trend of Commodities in National Commodity & Derivatives Exchange (Oct 08)
Table 22: Trend of Commodities in Multi Commodity Exchange of India (Oct 08)
Table 23: Trend of Metals in Multi Commodity Exchange of India (MCX) and National Commodity & Derivatives Exchange (NCDEX) (Oct 08)
Table 24: Trend of Oil Commodities traded in NYMEX (Oct 08)
Table 25: Trend of Metal commodities traded in NYMEX (Oct 08)
To order this report: Indian Commodities Trading Market
More market research reports here!
SOURCE: ReportLinker
Reportlinker
Nicolas: nbo@reportlinker.com
US: (805)-652-2626
Intl: +1 805-652-2626
Copyright Business Wire 2008
Monday, November 3, 2008
Commodities: Jim Rogers and Long Term Outlook
Commodity investors must have long term outlook says Jim Rogers
Jim Rogers has been known for saying he's the worst trader there is, and a terrible market timer.
The reason behind why he says it? We shouldn't think of ourselves or act like traders or market timers. History has proven that buying at low prices and holding on for the long haul far outperforms trying to time or trade the markets.
Warren Buffett of course also holds to and lives by this financial philosophy.
Now as far as the worldwide financial crisis, Rogers asserts that it's far from over yet, and by the time it's through, it'll be the worst economic crisis since World War II. The reasons why are the extraordinary excesses that created the crisis in the first place.
He adds that the government is making the usual mistake of interfering, and like the Great Depression in the United States, it'll make things worse, and elongate the pain.
Those who understand or have studied the Great Depression, know that there wouldn't have been one if the government hadn't interfered, as it prolonged it for many years, instead of the short time it would have worked itself out.
This happens because governments can't resist the temptation to make themselves look like saviors to the people, making it look like they're taking steps to alleviate their pain. The truth is the government causes much more pain, and this will happen again with the most recent, misguided bailout offered.
What underlies the mistake is the assumption the government should keep people from experiencing any pain. That's as stupid as those people who spoil and, in reality, abuse their children by keeping them from all difficulties in life.
As for Rogers, he continues to reiterate his commitment to investing primarily in agriculture, as he sees a growing demand that will continue to be a challenge to meet.
Concerning individual investors, Rogers adds that they should invest in sectors or companies they have a solid knowledge of. Nobody will know about them better than you if you do your homework.
The most successful commodities investors will continue to be those that do it with the long term in mind.
Jim Rogers has been known for saying he's the worst trader there is, and a terrible market timer.
The reason behind why he says it? We shouldn't think of ourselves or act like traders or market timers. History has proven that buying at low prices and holding on for the long haul far outperforms trying to time or trade the markets.
Warren Buffett of course also holds to and lives by this financial philosophy.
Now as far as the worldwide financial crisis, Rogers asserts that it's far from over yet, and by the time it's through, it'll be the worst economic crisis since World War II. The reasons why are the extraordinary excesses that created the crisis in the first place.
He adds that the government is making the usual mistake of interfering, and like the Great Depression in the United States, it'll make things worse, and elongate the pain.
Those who understand or have studied the Great Depression, know that there wouldn't have been one if the government hadn't interfered, as it prolonged it for many years, instead of the short time it would have worked itself out.
This happens because governments can't resist the temptation to make themselves look like saviors to the people, making it look like they're taking steps to alleviate their pain. The truth is the government causes much more pain, and this will happen again with the most recent, misguided bailout offered.
What underlies the mistake is the assumption the government should keep people from experiencing any pain. That's as stupid as those people who spoil and, in reality, abuse their children by keeping them from all difficulties in life.
As for Rogers, he continues to reiterate his commitment to investing primarily in agriculture, as he sees a growing demand that will continue to be a challenge to meet.
Concerning individual investors, Rogers adds that they should invest in sectors or companies they have a solid knowledge of. Nobody will know about them better than you if you do your homework.
The most successful commodities investors will continue to be those that do it with the long term in mind.
Wednesday, October 29, 2008
Commodities: Gold Mining Companies
Gold mining companies looking to preserve capital for yellow commodity business
Until the forced liquidation period is over, mining companies will have as their major goal the preservation of capital, rather than exploration and expansion. In other words, survival is the key during this difficult economic period.
None of the underlying fundamentals for demand has changed, as the needs of China remain. What all this will do is prolong the commodity bull market as we go through this temporary hiccup.
Like in any difficult time, commodity companies with heavy debt loads will suffer more than those that are run leaner. It's also probable that some of them either won't survive, or they will be bought up by healthy companies.
As far as commodities that at this time are being considered hot for 2009, tin, manganese, molydenum and bauxite are looking good. Others like cobalt, zinc and vanadium are probably going to tank over the next year.
Allan Trench, Australasian regional director of CRU research and advisory group said, "There is opportunity for the likes of tin, manganese and bauxite -- in the same way there was in uranium two years ago and as there was in phosphate earlier this year -- for IPOs."
Commodity companies that are well run will be looking to preserve capital throughout 2009.
Until the forced liquidation period is over, mining companies will have as their major goal the preservation of capital, rather than exploration and expansion. In other words, survival is the key during this difficult economic period.
None of the underlying fundamentals for demand has changed, as the needs of China remain. What all this will do is prolong the commodity bull market as we go through this temporary hiccup.
Like in any difficult time, commodity companies with heavy debt loads will suffer more than those that are run leaner. It's also probable that some of them either won't survive, or they will be bought up by healthy companies.
As far as commodities that at this time are being considered hot for 2009, tin, manganese, molydenum and bauxite are looking good. Others like cobalt, zinc and vanadium are probably going to tank over the next year.
Allan Trench, Australasian regional director of CRU research and advisory group said, "There is opportunity for the likes of tin, manganese and bauxite -- in the same way there was in uranium two years ago and as there was in phosphate earlier this year -- for IPOs."
Commodity companies that are well run will be looking to preserve capital throughout 2009.
Tuesday, October 21, 2008
Commodities: Positive Secondary Effects of Commodity Slowdown
On its third-quarter earnings call today, Caterpillar (CAT) confirmed what most of Commodity Surge readers already know, that over the short haul commodity prices will probably continue to drop, even after their steep plunge over the first half the year.
If you're in investor in companies like Caterpillar, who count on the business of companies connected to commodities, you'll find that they'll continue to make significant investments in raw materials and equipment to take advantage of the fall in prices.
In a statment Caterpillar said: "A weakening world economy could continue to push prices down and impact producers' investment plans.
"The current investment cycle was already under way in early 2005 when the oil price was a little over $40 and copper was $1.40. Current prices remain favorable for investment."
So while the eventual return of higher commodity prices could negatively impact company investments, for now we should see an upswing to grab low prices while they can.
Of course we have the credit problem to deal with in relationship to getting the funding to make these purchases. But companies with a low debt load are in a strong place to take advantage of the declining prices, and companies like Caterpillar will be helped significantly from that.
The problem for Caterpillar hasn't been sales, which for the quarter were at a record high, it was the high costs of materials which undermined the profits; falling by 6 percent even with the increased sales.
Steel prices were the primary culprit in downward profit results for the quarter.
The commodity slowdown is only going to be temporary, be prepared and watch for when the commodity bull market continues.
If you're in investor in companies like Caterpillar, who count on the business of companies connected to commodities, you'll find that they'll continue to make significant investments in raw materials and equipment to take advantage of the fall in prices.
In a statment Caterpillar said: "A weakening world economy could continue to push prices down and impact producers' investment plans.
"The current investment cycle was already under way in early 2005 when the oil price was a little over $40 and copper was $1.40. Current prices remain favorable for investment."
So while the eventual return of higher commodity prices could negatively impact company investments, for now we should see an upswing to grab low prices while they can.
Of course we have the credit problem to deal with in relationship to getting the funding to make these purchases. But companies with a low debt load are in a strong place to take advantage of the declining prices, and companies like Caterpillar will be helped significantly from that.
The problem for Caterpillar hasn't been sales, which for the quarter were at a record high, it was the high costs of materials which undermined the profits; falling by 6 percent even with the increased sales.
Steel prices were the primary culprit in downward profit results for the quarter.
The commodity slowdown is only going to be temporary, be prepared and watch for when the commodity bull market continues.
Thursday, October 16, 2008
Commodities: Pardo Capitol Holding its Own
Pardo Capital Enjoys Solid Growth, Steady Rise
CHICAGO, Oct 16, 2008 (BUSINESS WIRE) -- While stocks tumble and surge, the roller coaster ride for Americans may be starting to grind to a halt. But for those who have invested in XT99, an automated algorithmic trading system, the trip has been a steady climb.
Pardo Capital Limited and XT99 had an impressive September -- while Wall Street plummeted,XT99 rose9.7% for the month.
"We're pleased with the performance and integrity of our automated system, to say the least," said Bob Pardo of Pardo Capital."Year to date, we're up 33.9%, and the ten year track record is a compounded annual return of more than 22%."
According to information provided by Pardo, when you consider this compounded annual rate of return, the overall return is an impressive 547%.
XT99 trades exchange traded futures markets on a global scale.This includes currencies, agricultural commodities, energy, stock indices and fixed-income instruments.
"We've designed this model to exploit long-term, macro-economic trends," Pardo said. "Unlike many long-term trend followers, XT99 is better at anticipating trends and that is proven in our substantial results."
According to Pardo, risk management is accomplished through traditional pathways such as market diversification and trading pace diversification, but the foundation of the risk model is a proprietary asset allocation methodology developed by his partners.
For more information on XT99 contact Marketing Director Rich Sternal at 630.355.2337 or rasternal@pardocapital.com or visit Pardo Capital.
SOURCE: Pardo Capital Limited
Pardo Capital Limited
Rich Sternal, 630-355-2337
rasternal@pardocapital.com
www.pardocapital.com
Copyright Business Wire 2008
CHICAGO, Oct 16, 2008 (BUSINESS WIRE) -- While stocks tumble and surge, the roller coaster ride for Americans may be starting to grind to a halt. But for those who have invested in XT99, an automated algorithmic trading system, the trip has been a steady climb.
Pardo Capital Limited and XT99 had an impressive September -- while Wall Street plummeted,XT99 rose9.7% for the month.
"We're pleased with the performance and integrity of our automated system, to say the least," said Bob Pardo of Pardo Capital."Year to date, we're up 33.9%, and the ten year track record is a compounded annual return of more than 22%."
According to information provided by Pardo, when you consider this compounded annual rate of return, the overall return is an impressive 547%.
XT99 trades exchange traded futures markets on a global scale.This includes currencies, agricultural commodities, energy, stock indices and fixed-income instruments.
"We've designed this model to exploit long-term, macro-economic trends," Pardo said. "Unlike many long-term trend followers, XT99 is better at anticipating trends and that is proven in our substantial results."
According to Pardo, risk management is accomplished through traditional pathways such as market diversification and trading pace diversification, but the foundation of the risk model is a proprietary asset allocation methodology developed by his partners.
For more information on XT99 contact Marketing Director Rich Sternal at 630.355.2337 or rasternal@pardocapital.com or visit Pardo Capital.
SOURCE: Pardo Capital Limited
Pardo Capital Limited
Rich Sternal, 630-355-2337
rasternal@pardocapital.com
www.pardocapital.com
Copyright Business Wire 2008
Subscribe to:
Posts (Atom)