How can anyone predict the crude prices?

[Pekelo]

Andy Hall who has been labeled the "God Trader" is down 500 million this year on oil.....

http://www.cnbc.com/2015/08/06/god-trader-andy-halls-fund-loses-500m.html

And this was back in July-Aug.

Lost 7% in Sept, and was down 20% YTD by Oct 1st.

http://www.wsj.com/articles/oil-bull-andrew-hall-stands-his-ground-1444692175

Lost almost 10% in November, so the YTD losses were 26%...

http://www.wsj.com/articles/losses-at-andrew-halls-oil-fund-deepen-1449595591


"Astenbeck’s assets under management fell to $2.4 billion, down from $3 billion at the start of the year and nearly $5 billion less than three years ago.
The fund is on track for its worst year since its inception in 2008."

Poor Andy might have to sell his castle in Germany...

 

[Xela]

How can anyone predict the crude prices?

The same way that any successful traders can be said to "predict" anything, i.e. as a statistical/probability-function based on their education and experience, and in such a way that they win more collectively from their winning trades than they lose from their losing ones. Otherwise it's not "prediction" in any meaningful sense, in this context, is it?

It's a completely political process

That's more from the investing than from the trading perspective, surely? Fundamentals can be relevant to almost all traders, but no more so in the case of oil specifically than with anything else?

 

[Frederick Foresight]

Poor Andy might have to sell his castle in Germany...

I hate when that happens.

 

[felixbocharov]

Thanks for sharing your thoughts. There is a good chance to predict stock price, but oil? For me it's impossible.

 

[Jamie J.]

Not only for you, it is really impossible. But clearly that the analysts say the price still remains under pressure for some time and the rate of decline is accelerating.

 

[Cswim63]

Thanks for sharing your thoughts. There is a good chance to predict stock price, but oil? For me it's impossible.

I'm speculating here, but the difference between stocks and oil is that one is in a long uptrend, the other in a downtrend. You can't pick a bottom in a market that keeps breaking down and expect to get away with it. No matter what the indicators say. There's no support in a bear market.

 

[londonkid]

This is completely weird to me and I can't understand the logic of the process. It's a completely political process, and politicians are changing their minds every day.

The cartel of oil companies can and do manipulate production, storage, pipelines. The oil companies do well out of their trading operations. You can buy in physical data however its very expensive and still no comparison to being on the inside.

 

[SunTrader]

If you knew what was going to happen it would be easy to predict the future.

Uhhh rethink that one.

 

[murray t turtle]

Andy Hall who has been labeled the "God Trader" is down 500 million this year on oil.....

http://www.cnbc.com/2015/08/06/god-trader-andy-halls-fund-loses-500m.html

And this was back in July-Aug. Andy thinks the market is wrong and he is right. Guess what Andy the price is never "wrong" the price is what people are buying/selling it at


I am up this year on oil btw...

%%
Well you have to give that oil bull credit; he left Citigroup, with $100 million bonus, i guess that bonus was in US dollars, or stock options?? .Thanks; the news story did not say if he shorted C,or why he left Citigroup.He may do fine, MODERN TRADER magazine has a FEB comment;''favoring conviction over prediction, since 1972''.That's wisdom, NOT a prediction.

 

[OddTrader]

Lost 7% in Sept, and was down 20% YTD by Oct 1st.

http://www.wsj.com/articles/oil-bull-andrew-hall-stands-his-ground-1444692175

Lost almost 10% in November, so the YTD losses were 26%...

http://www.wsj.com/articles/losses-at-andrew-halls-oil-fund-deepen-1449595591


"Astenbeck’s assets under management fell to $2.4 billion, down from $3 billion at the start of the year and nearly $5 billion less than three years ago.
The fund is on track for its worst year since its inception in 2008."

Poor Andy might have to sell his castle in Germany...

Q Jan. 17, 2016

Why The Crude Oil Trading 'God' Is Down $3 Billion


Summary

Andy Hall's Astenbeck Captial Management is down more than $3 billion.

One reason appears to be "confirmation bias".

Another reason appears to be a failure to manage risk.

Benjamin Graham defined investment management as the management of risks.

A quantitative, decision-making process can be useful managing risks, preventing confirmation bias.

http://seekingalpha.com/article/3814796-crude-oil-trading-god-3-billion

When his bonus from Citibank was blocked under TARP, his firm was sold to Occidental Petroleum. Mr. Hall later established a new fund, Astenbeck Capital Management. Assets under management (AUM) were $4.8 billion in January 2013. By the end of 2015, his fund had dropped in value to about $2 billion, after suffering a 35% loss in 2015. Given published returns in the media, I estimate that he experienced net redemptions of about $1.15 billion over the past 3 years.

Assuming he has not changed his strategy, which seems like a safe bet, given the conclusion in his January 6, 2016 letter ("We therefore continue to believe that the shorter term headwinds are ultimately trumped by the longer term outlook for prices which remains firmly to the upside."), Mr. Hall's fund is down another 20% in 2016 YTD, to $1.6 billion. If prices drop to $20, his AUM will be down to about $1.06 billion, assuming no "long" strategy change or redemptions.
UQ