My new position in the cocoa market

Elen Lindisova | Trading ideas | 9. 6. 2017

I have opened a bull spread in cocoa. Despite the spread being low-risk, my position isn’t large for several reasons. Let’s comb through the charts. I always begin with the Commitments of Traders analysis. It’s like a screening filter which tells me whether the opportunity is worth my time. The COT is clear in cocoa…

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Modelling carrying charges for grains

Pavel Hála | Announcements | 24. 4. 2017

I’m excited to announce some interesting new features in our app regarding grains and carrying charges. These functions are actually nothing new for me. I coded them for ZC, ZS, ZM and ZL sometime in 2010 into my personal Javascript app that later became an alpha version of the SpreadCharts.com app. What’s brand new today and…

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Understanding commodity ETF decay

Pavel Hála | Quantitative trading | 1. 3. 2017

In the previous article, I explained the compounding effect and the reason why leveraged ETFs lose value over time. Today, we’ll take a look at commodity ETFs. These funds can decay very fast, even if they are non-leveraged. That’s because the mechanism of decay is of a different nature than that of leveraged ETFs holding…

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Why Excel won’t be enough?

Pavel Hála | Quantitative trading | 18. 6. 2015

In the previous article, I’ve explained what quantitative trading is about. In this article, I will briefly describe how to start your own research. As I wrote last time, I’m writing about my path and my approach, which may not suit everyone. So take this article as an inspiration. Quantitative trading has a great advantage…

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Cattle-hog spreads at unsustainable levels

Pavel Hála | Trading ideas | 30. 3. 2015

The nearest spread between live cattle and lean hogs (LEJ15-HEJ15) was formerly considered wide at levels above 30c. It’s trading above 100c right now and still rising. This situation is unsustainable from the long term perspective. It’s only a matter of time before these markets at least partially converge. The profit potential is great, but…

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State of the crude oil market

Pavel Hála | Analyses | 9. 3. 2015

Crude oil has come through a massive sell-off. There are three main causes that led to this situation. Most importantly is the oversupply caused by rising production in the US (fracking), other causes are a strong dollar (US economy in good shape) and weak international demand (China slowing down). Although the current downturn is severe,…

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