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I am getting a little concerned about Oil being mentioned everywhere in the media. It's a getting little overdone. I smell a short squeeze coming. But sell into that! :)

Yup, already did that.

https://www.dollarvigilante.com/blog/2016/01/11/shipping-said-to-have-ceased-is-the-worldwide-economy-grinding-to-a-halt.html

This is a little.......scary. https://www.superstation95.com/index.php/world/750 You can hear a pin drop.

Yeah I've said this before what is really killing these guys is not lower prices but time. The longer we stay down here regardless if it's 25, 35 or 45, it just is not sustainable for a lot of upstream companies. Heaven forbid rates should go higher then the flood gates really open. That's...

This WTI is scary though. Even when China popped, oil could barely uptick. I think there is a massive liquidation coming soon from someone going under and the market is expecting their reserves to get dumped on the market at firesale prices. I think once we start to see this liquidation...

This might have to do with what Fisher was talking about where there is demand for delivery for the prompt month vs back going into expiration. which is less then 2 weeks. The HJ spread today is doing nothing (month 2 vs 3) and the Feb/Dec got killed today. I do think that front spread will...

That's a good guess. I would say the avg price low will be in the mid 20's but the issue is when we get that low volatility will be very high and I think overnight we could wick into the teens as a final FU to the bottom pickers. The real pain here for the producers is not price but time...

Sure, in the long run, all competitive markets end up getting priced at marginal cost. In the case of oil that will be the marginal cost of the lowest cost producer which is Saudi. That will be in the $10 to $15 range.

You really need to look for the possible residual effects. I like what Bass is doing by looking for banks that have loan exposure to China in the Asian region. That's one way to play China in general. So you want to look for stuff that is highly correlated to a weaker Yuan. I don't have any...

Yeah just for your own personal education, it's not the number of live trades that matter. Let me give you an extreme example. Say I have a system that only buy stocks and it buys them on the open and sells them on the close. Say in year X the market was down every single day that year...

It traded up to my monthly A up at 2.50. The number line is thinking about re-setting.

Well yeah I agree however I think he is implying a substantial move. I agree a small return to normal will not generate a profit with the contango. If oil does start making a large move higher it will eventually go into backwardation and the oil etf will have a positive roll yield. So keep...

I think you will need more then 3 months. I would shoot for 3 years of historical data (backtested) against a random data set using a monte carlo type approach. Normalize your returns by risk and compare to the random portfolio.

Hmm Ok. That chart looks ugly. I need to run some number lines on these spreads. I expect they are still deeply negative. It's kind of hard to imagine getting back to parity anytime soon from looking at that chart. We had a flat curve back in May of last year briefly. As always I usually...

It's still a dollar away from being backwardated right?

We're still pretty far off from that no? Looks like we wicked off of both the A down and A up. Lot of movement there for sure but given how far this thing has dropped it seems reasonable.

Great interview.

First Amendment and all that jazz. You do know we have a forum here with like 30 million posts discussing "trading topics". Just sayin....