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Warrington August 2021 Market Update
Commentary provided by Mark Adams of Warrington Asset Management The S&P 500 Index (“S&P”) continued its relentless advance throughout August in the face of ongoing global crosscurrents. The exponential spread of the Delta variant of Covid, the resurgence of Taliban control in Afghanistan, and the underreported troubles of China’s largest real estate developer (Evergrande), all provided […]
August 2021 Flash Report
Equity markets continue to trend higher with yet another consecutive month of positive returns. Inflation fears seem to have subsided and the Fed is looking at tapering bond purchases which the market has already expressed. We seem to be at a crossroads as the global economy determines which direction we go. What will impact […]
Options Made Simple
For any profession, once you have done it for a while, some concepts become second nature to the point that you forget that not everyone (or very few) understands them at even a basic level. I find that options are the concept that confuses people the most and perhaps most valuable to understand. The futures […]
August 2021 Market Letter
Commentary provided by Chad Burlet of Third Street AG Investments Released: August 31st, 2021 In comparison to the three highly volatile months which preceded it, the price action in August was rather pedestrian. Corn, wheat and soybean futures all had monthly trading ranges below 12% and their net price changes for the month were 0 – 4%. […]
Warrington July 2021 Market Update
Commentary provided by Mark Adams of Warrington Asset Management The net return of the S&P 500 Index (“S&P”) for July once again masked a series of domestic and global undercurrents that had the potential to negatively impact the world economy. In the end, none of those contributors had the ability to derail the ongoing rally […]
Gamma Q July 2021 Market Update
Commentary provided by Todd Delay of Gamma Q Further consolidation occurred in July with range-bound trading for corn and soybeans. Wheat was the leader with deteriorating conditions across many areas, particularly the Northern Plains supporting price. The July WASDE report reduced wheat stocks by nearly 100 million bushels, and we feel further reductions need to […]
Who is Driving the Bus?
Nobody likes paying for insurance. It is intangible as you pay up front for an unknown risk that may or may not materialize. Many of us feel that we overpay, until we really need it. It is perhaps not surprising then that many investors spend little effort protecting against sudden and unexpected drops in the […]
July 2021 Market Letter
Commentary provided by Chad Burlet of Third Street AG Investments Released: August 1st, 2021 We came into July on the heels of a huge price rally caused by the USDA’s June 30th acreage report. Their estimates for corn and soybean plantings were both more than a million acres below the average of the analysts’ estimates. Those rallies […]
Call me a Pessimist
All investors know the adage to “buy high and sell low” but few adhere to it. We can see this with record volume to start July trading coming mostly from retail investors as the S&P reaches another all time high. Perhaps I have been in the futures industry too long because when things are “too […]
June 2021 Market Letter
Commentary provided by Chad Burlet of Third Street AG Investments Released: Wednesday, June 30, 2021 In our May Market Letter we wrote about the exceptional volatility in the agricultural futures markets. June showed us that May was just a warmup. In May corn had seen a 3.5% break and a 3.9% rally in a very short time […]
Hedging an equity portfolio: Volatility
In our last article, “Why Traditional Hedges Fail,” we opined that most traditional hedges had significant weaknesses and did not have many characteristics of a great hedge. Volatility (long positions in VIX futures), while not perfect, has a number of these favorable characteristics for hedging an equity portfolio. The characteristics of an excellent equity hedge […]
A Better SPY?
Index investing is all the rage now, with over a trillion dollars invested in the SPY and VOO ETFs alone. Low fees coupled with broad market exposure are expected to be better for your portfolio than an actively managed strategy with higher fees. One could argue that as the indices’ components attract more capital flow, […]
When Good News is Bad
My favorite analogy for passive investing describes two men sitting at a bar. One is drunk and the other sober. When the night is over the sober man leads the other home to make sure he gets there safely. Historically, hedge funds and active investors pored over financials, looked at P/E ratios, and listened to […]