The G Manifesto

Commodity Trading: Risk is Relative

Weekly Commentary
For August 3rd– August 7th 2009
By: Matthew Bradbard

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Even after the recent market turmoil it appears investors still have an appetite for risk. Whether the risk taking is misguided is debatable, but the reality is if investors are more informed about the inherent risk they may be more comfortable taking risk. Though there still seems to be more questions than answers for investors to earn above average returns, they may need to be willing to take above average risks. That is not to say the stock market alone, real estate, bonds, or even commodities should be your sole focus it just means that investors need to educate themselves on the unique risks for each asset class and really ask themselves what type of beta they can handle in their portfolio. My suggestion would be to consult a professional in the chosen asset class that interests you and align yourself with someone that has a comparable take on the markets.

To find out exactly how we are positioning our clients in commodity futures and options, Contact us today at 1-888-920-9997.

Financials

Stocks: The million dollar question was asked in Barron’s over the weekend” How much of the recession’s passing is already priced into stocks?” The S&P was higher by 7.50 points last week to trade to a fresh high for 09’. We are still not ruling out a test of 1000 before prices back off but we will remain consistent and reiterate that we do expect a sell off very soon. That being said we were light buyers for clients in the ES September 925 puts for $800 last week as we expect in the next 2/4 weeks a trade down to 945/950. The Dow was higher by 75 points last week, gaining over 1000 points or 13% just in the last 3 weeks. With July now behind us the Dow put in its best monthly performance in more than 7 years, do things feel that good? Resistance is seen at 9200/9225 with support at 8990 followed by 8825. A trade back down to the 50 day moving average would only be a correction of 6%. We have suggested for clients to lighten up on those stocks in their portfolio that have gained over 50% since the March lows.

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Click Here 007 Lifestyle – Living Like James Bond!

Crush It!: Why NOW Is the Time to Cash In on Your Passion

Click Here for Mack Tactics: World Famous Dating Program For Men!

Bonds: September 30-yr bonds were higher by 2’25.5 points last week to trade to their highest level in 2 ½ weeks. Resistance comes in at 120’00 with support at 118’00 followed by the 40 day moving average at 117’00. September 10-yr notes were bid higher as well gaining 27.5 ticks last week. Support is seen between 116’11 and 116’17 and resistance between 117’28 and 118’00. We advised clients last week to exit their NOB spreads at a profit of roughly $1500 per spread as we reached our target. We also advised clients to lighten up on their Euro-dollar puts as we expect a trade higher in the near term. However we would sell into this rally and look to re-establish these positions in the coming weeks buying more June & September 10’ puts. The NFP # guess comes in at a loss of 375,000 jobs for the month of July and an unemployment rate of 9.6%.

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(Here is my Facebook, New Twitter and The G Manifesto Facebook Page)

Click Here 007 Lifestyle – Living Like James Bond!

Crush It!: Why NOW Is the Time to Cash In on Your Passion

Click Here for Mack Tactics: World Famous Dating Program For Men!

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Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Before trading MB Wealth recommends that you should carefully consider your financial position to determine if commodity trading is appropriate for you. All funds committed should be purely risk capital. Past performance is no guarantee of future trading results. There are no guarantees of market outcome stated, everything stated above are our opinions.