What world events tell you enough about energy markets to make the smart move?

Saudi Arabia isn’t flooding oil market ahead of freeze talks
Oil prices surge as hedge funds reduce short positions
U.S. natural gas market rebalances on hot weather, low prices
Freight recovery offers hope for U.S. diesel demand in 2017
Will OPEC agree to freeze output in Sept? Source: Reuters

The amount of information to digest is daunting.   The numbers move towards proving your convictions or they begin to run away from you, emotions can run high and skew decisions right at the time it really counts.

Decadian commodity research takes in the myriad of factors and sifts through it all to find a small handful of investments to recommend.  This is where experience and specialized knowledge comes in play.  The many methods of trading often on sketchy knowledge and trend lines to take advantage of tiny movements has a way of eating up capital and not producing the profit one hoped for.

The less risky Decadian way is to filter through all the good trades that carry moderate risk and settle on the handful of outstanding trades that also have the lowest risk.  This may be four or five opportunities a year. When emotion is removed from buy/sell decisions, the investor is free and confident.

Time is actually on your side when the time is used for fact finding research instead of jumping from one trend to another.  It’s not the volume of trades hoping for profits to add up, it is the few extremely smart trades that bring a return based on solid research and intelligent timing.

Commodity trading is the opportunity to earn the biggest riches.  With all the technological advancement and economic globalization, commodities as investments have gone mainstream.

In the present world’s economic situation, where markets are fluctuating on a regular basis,  people can make a substantial amount of money simply because they invested in commodities.  But simple becomes complex if you are a beginner.  It is very important for you to know what you’re doing in the commodities market because of the presence of leverage.

Unlike the stock market, the commodity market is less comprehensible for  investors and traders.  Before you make a decision on getting into commodities, it is best to get some knowledge about the fundamentals of commodity trading, and find an entity that does solid commodity research.

Just like wheat and copper, commodities are usually the primary goods traded in commodity markets on regularly basis. They are traded in the standard of volume and weight, and have a globally recognized quality standard. This is important as traders do not always see the commodities they buy and sell so they scarcely find an opportunity to check the quality. However, commodity exchanges confirm the standards of the commodities. Furthermore, traders need not worry about the quality and quantity of the commodities; what they need to worry about is the decisions they need to take due to the market conditions. They also need to maintain a close eye on some external factors since they can affect the commodity’s prices to a great degree.

Two primary factors have contributed to the phenomenal recent growth in commodity investments. First, significant advances have been made in the various investment instruments that allow investors to gain an exposure to commodities.

Second, two major as set classes, equities and real estate, performed poorly and experienced high volatility following the “tech bubble” in 2000 and the “subprime crisis” in 2008–2009, motivating investors to seek out asset classes that are alternatives to equities and real estate. Source:  CFA Institute  and  Literature Review

It is vital to know how to take disparate information about specific commodities, and understand when the time is right for you to buy and sell.  Keeping a close eye on the supply and demand, and the external factors that play upon their pricing, immense wealth creation is achievable.   However, the path followed by most, is ruled by emotion, which is probably the greater risk to decision making than anything else.  Separating the investor from this type of risk is a key ingredient in why Decadian focuses on commodity research that includes local and global effects.

Investors see Citi is at it again, reading tea leaves for 2017.  Looks like they expect investors to rebalance and plow cash into funds.

Returns from commodities trounced those from other assets in the first half as the oil market showed signs of re-balancing, spurring a rally. The half ended with the U.K.’s vote to quit the E.U., boosting concern about the outlook for growth. Global raw material demand still continues to grow, helped by the U.S. and China, while supply cuts are showing in petroleum and North American natural gas, some base metals and farm products, Citigroup said.  Source: Bloomberg

Citi simply knows oil is underwater now and is likely to go up.  Not really the kind of information you need to time investments in commodities.  Decadian’s commodities research lab considers a variety of factors that affect individual commodities, when taken all into account, can reveal when it’s time to pull the trigger on a specific commodity, and also signal when it’s time to get out.

If you’re interested in making great investments in commodities, you need to know the facts.


The ‘Fix’ Is In!

We hear the ‘fix is in’ a lot in politics, but we’re talking ‘fixed income’, as in Treasuries.  Funny how just under a 5% return brings excitement. The opportunities found in commodities, especially with built-in leverage, can make that reported return on Treasuries paltry in comparison.

The fixed income world, in particular the Treasuries, has been a ‘Treasure Trove’ for investors this year. This is especially true as Treasuries have returned 4.8% in the first half of 2016 based on Bank of America Corp.’s U.S. Treasury Index. Excerpt: Zacks

All kinds of economic actions take place everyday, emotional reactions to it kind of skew things until few experts know which end is really up, or what actions based on perceptions take over their decision making.  It really is why Decadian’s research leaves emotion out of the decision making entirely.  No wonder consistent results play out more often. The approach of the Decadian research lab is to work through big data, and use the specialized knowledge gained over years of being steeped in farming and commodities.  Sifting through more variables and understanding the interdependence of supply and demand, the weather, exchange rates, world events, etc….

Global growth concerns, China-led deceleration fears, oil price volatility, geopolitical tensions and an uneven domestic economy have driven demand for safe-haven bonds since the start of the year. Both the World Bank and the International Monetary Fund (IMF) have slashed their global growth forecast for the second time for this year. Excerpt: Zacks

But what does Decadian think of ‘stubbornly’ low commodity prices and weak trade?  Well, ‘stubbornly’ is someone else’s word and belief system that contains a tinge of emotional distortion.   What it indicates is, it’s time to assess positions for more profit opportunities.  Learn More.