| Hedge funds scent a market turnaround amid turbulence
London: If hedge funds are, as is often claimed, the investment vanguard, their latest moves appear to be telling financial markets it is time to take a break from the trading patterns that have dominated since mid-2007. Investment banks have been poring over the latest data on hedge fund positioning from the Commodities Futures Trading Commission (CFTC) and concluded that a number of speculative bets have been changed. Societe Generale, for example, says long positions on 10-year government bonds have been closed. That is to say, hedge funds are not expecting demand for such bonds to increase and drive yields lower. .
NCEL launches awareness drive for rice trading
KARACHI: National Commodities Exchange Limited (NCEL) on Monday launched a month-long pre-launch programme and investor awareness drive ahead of the commencement of listing and trading of its IRRI-6 Rice Futures Contract.
Managing Director Assim Jang said NCEL will be in Kandhkot, in upper Sindh, holding the first of investor awareness seminars aimed at informing the potential participants, including growers, millers, traders and exporters of the details of Futures Trading in IRRI-6 rice and encouraging their participation.
We have chosen these areas to start out investor awareness drive as they are the trading hubs of IRRI-6 rice, Assim said adding, we feel it is important to reach out to the key participants in our market on a one-to-one basis, they will not only ultimately benefit from this new contract, but also will provide NCEL with the necessary depth and liquidity, he added.
CME bid spurs fears of merger monster
THE commodities boom is intensifying the merger mania among the world's financial exchanges. But the $US11 billion ($12.4 billion) bid by CME Group to acquire Nymex Holdings may fuel worries that consolidation is leaving the survivors with too much power. A purchase of the 135-year-old New York Mercantile Exchange's owner by CME, parent of the Chicago Mercantile Exchange, would create the largest exchange in the world, with a stock market value of about $US45 billion. And acquiring Nymex's crude oil futures, one of the largest commodity contracts in the world, would fill the last major hole in the 110-year-old Chicago exchange's product line-up, while squeezing remaining rivals in the energy market. The deal also highlights some unsettling consequences of the global scramble for alliances and market share in trading financial securities.
Refco ex-VP pleads guilty
A former senior executive at Refco Inc. became the first company official to plead guilty to defrauding investors in the failed trading giant on Wednesday, one day after a Mayer Brown lawyer was indicted on criminal charges.
Santo Maggio, former executive vice president, admitted in a New York federal court that he "participated with others to hide the true financial health of Refco." He worked at Refco from the late 1990s to October 2005, when the futures and commodities broker collapsed after disclosing that an entity partially owned by former Chief Executive Phillip Bennett owed the company about $430 million.
The debt stemmed from client losses that had piled up since the mid-1990s, according to federal prosecutors. Mayer Brown partner Joseph Collins, who represented Refco for more than a decade, helped hide the debt for several years, prosecutors charge in his indictment.
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Sam Seiden brings over 15 years experience of equities and futures trading which began when he was on the floor of the Chicago Mercantile Exchange. He has traded equities, futures, interest rate markets, forex, options, and commodities for his personal interests for years and has educated hundreds of traders and investors through seminars and daily advisory services both domestically and internationally.
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Working Paper Synopsis: The Search for the Beta of Commodity Futures
In accordance with the principles of modern portfolio theory, sophisticated investors have increasingly sought to diversify their portfolio through the use of alternative investments. An "alternative investment" is generally regarded as supplementary assets or trading strategies other than long-only exposure to "traditional assets" such as stocks, bonds and/or cash. Alternative investments include various assets such as commodities, currencies, emerging markets and private equity, as well as a variety of trading strategies such as convertible arbitrage, distress securities, global macro, long-short equities, managed futures, short selling, etc. Adherents commonly assert that alternative investments has (i) a low to negative correlation compared to traditional investments, (ii) historical performance which reflects the potential for attractive positive expected returns, and (iii) is capable of acting as a hedge against inflation.
Commodity ETF Jumps As Wheat Hits Record
The market may have lost its appetite for stocks, but it's hungry for commodities, especially wheat. Wheat soared to a record Friday as the Agriculture Department forecast that supplies will drop 40% from last year to a 60-year low in May. It already has more than doubled in the past year. Corn, soybeans, gold and platinum have also soared to new records. "We're in an inflationary cycle that's heating up, so things such as commodities are becoming more valuable than paper assets," said Adam Harter, director of operations at Financial Enhancement Group, with $200 million in assets. "People in developing economies are seeing incomes rise and are able to buy more and that's putting a pressure on the demand side of the equation." Trading Futures In lock step, PowerShares DB Commodity Index (DBC) broke out to a new high Friday.
Thomson Financial Europe AM at a glance share guide: Stocks, oil mixed
STOCKS: Wall Street retreated Thursday after Federal Reserve Chairman Ben Bernanke predicted a "sluggish" economy until later in the year and more mortgage-related losses at banks. Bernanke said the housing and credit crises have weighed on the economy and curbed hiring. Though the Labor Department Thursday said the number of workers filing unemployment claims fell 9,000 to 348,000 last week, Wall Street remained worried that businesses are becoming cautious about hiring and that unemployment will compound the debt problems that have been slamming the markets and the greater economy after the January jobs report that showed the first net jobs loss in more than four years. In addition, the Commerce Department reported Thursday that the trade deficit narrowed in 2007, dropping to 711.6 bln usd, after five years of record expansion.
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