Seasonal spreads

Cokes, I would suggest that you first subscribe to the weekly commentary which I think is an incredibly good deal. Had I followed it exactly, even only where electronic orders are possible, I would have made already over 50% on my capital, which I figured is $20,000, for the monthly commentary I figured $50,000 would be required - MCRI does not provide any figures in that respect. I think they want to be very careful not to give any specific trading advice for regulatory reasons, otherwise they are very helpful and answer any e-mail promptly. Oh, I forgot, you should first subscribe to their 2 week free trial.

The web site is not the clearest one in the beginning to understand. Just navigate the right side bar and click on everything you see; once you get used to the Weekly Commentary there is tremendous information you can gain - I also missed a lot of available information in the beginning but now I think it is great and it is updated daily. Once I am settled down with my other trading systems - right now I am looking into two very interesting forex systems (not get rich quick systems but aimed at getting fairly reliable yearly returns between 25% and 30%, a long term investment strategy) I will probably look into buying from MCRI some special reports, their Encyclopedia and maybe try the monthly report.

youngtrader, thanks for the tips regarding not to trade the meats electronically - any advice, suggestion or opinion is always appreciated, I am sure hrokling will agree.
 
Quote from youngtrader:
Our company has used man financial from the start and have never had a problem with our orders getting filled. We trade a lot in the pits and have still had good luck with them. Sorry to hear about your bad experience with them. As for trading the meats electronically I would not advise that. The meats are one of the last hold outs of pit trading and over 90% of the volume is done on the floor. I would send the orders down to the pits especially if you are thinking about doing spread orders.
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Good to hear that MAN is working for you - how are the fills? Do you get better fills because your company is a big(ger) client? I've never done pit orders, so I know next to nothing about it :)

Thanks for the advice on meats, much appreciated. Would love to hear more about what seasonality you're focusing on.
 
Ok, I'm going crazy here. I've been using futuresource.com for my spread quotes, since they allowed me to enter all sorts of formulas and such. BUt they seem to have changed thir data source over the weekend, and I can't fuigure out how to do formulas - they don't seem to support it anymore. Anyone figured it out?
 
Today I've closed both spreads in Oats/Corn as I've found that they've been well within expected profit for a few days, and the spread topped out with the recent runup in Corn. Since Corn came back down today it was a good time to close it - although the seasonality I planned lasts until July 15th for the March 08 spread, and until July 30th for the September spread.

Bought 2 Sep ZC Corn, Sold 3 ZO Oats @ 125 3/4 - CLOSED - PROFIT 99 1/2 which is 4.975 usd.

Bought 2 Mar 08 ZC Corn, Sold 3 Mar 08 ZO Oats @ 103 1/4 - CLOSED - PROFIT 74 1/4 which is 3.713 usd.

These trades worked out excellent I must say.
 
Bought 3 Mar 08 ZS, Bought 3 Aug ZS Soybeans @ -49 - CLOSED - LOSS 12 3/4 which is 1.913 usd.

In the beginning this spread looked like it was working, so I added to the position - however it started a nice, smooth totally beautiful downtrend which I'm just shaking my head at. This is why I need timestop/stoploss. Together with the 30Y/2Y trade in May/June this is inspiration from some of the rules I'll be implementing soon.
 
Bought 1 May 08, Sold 1 Sep ZW Wheat @ 8

This spread I've been watching for a few days, and I started bidding with limit-orders when it was negative. Today it jumped, and I'm beating myself up for being so cheap with my limitorders (I could have had 4 contracts with a negative difference!). I got 1 contract now just to participate, and if it pulls back (not likely I think) I'll add to the position as I'd rather have 3-4 of this one.

What kind of makes up for it is that I've entered another spread which isn't really part of my seasonal plan but the opportunity was there for a nice carry trade. I got 4 May 08/Mar 08 ZW at an avg of -13 1/2 (friday and today) which is an excellent entry. This will howeverer not be included in my journal - just saying :)

And talking of spreads - oh how that RB-spread was prematurely exited on Friday. We're talking an extra 1600-1700 usd that I missed - I think I was a bit careful with my profit projection.
 
Sorry about not responding earlier. Yes our fills have been great I don't know if it is because we trade bigger size or not but I wouldn't think so. From what I have heard man is a great broker for trading in the pit but the only broker we have ever used is man so I could be wrong. My father is still very old school and prefers to have the trade done with human interaction as apposed to electronic trades. Spreads are also a little more liquid in the pits also.

We primarily focus on a few seasonal stratagies throughout the trading year mainly consisting of lumber and unleaded gasoline positions. We have found these contracts to be some of the most seasonal products to trade These are usually our biggest positions during the year and then we make other trades mainly in the energies and grains throughout the year.

Something we are looking at now and focusing on are the wheat spreads. Now this is not because of seasonality but because of huge fundamental factors in the wheat market. We currently believe in going long both kc and minn wheat over chicago and expect there to be nice profits all the way to the end of the year. Also another thing to think about is milk seasonals. We have never traded them but I hear they are very seasonal with lots of 100% trades.
 
hrokling -

I got into the same Wheat spread last week. In fact, I got in at 8 and when it dropped to negative I did something I never, never do - I averaged down. The thing with the carrying charge spreads is, you know that they can't really get too far out of whack, since it's the same stuff delivered at different times. So i'm more comfortable waiting them out than, say, some of the energies (I got beat up last week on a RB-HO spread, which has since bounced back...)
 
Added to the May08/Sep Wheat trade today:

Bought 1 May 08, Sold 1 Sep ZW Wheat @ 5

This brings me to 2 contracts at an average of 6 1/2. I have a few more limit orders in further down, in case the spread continues to pull back.

Other than that, I've added a few more Wheat spreads which aren't in my seasonal plan - I'm growing more and more in love with spreads and am considering moving some of my risk capital currently allocated to equities over to my futures account. After some research I also deem it possible to do certain Meat strategies electronically - in Lean Hogs and Live Cattle as long as it's not too many contract months out. Today I've actually put on a Lean Hog-spread as well!

Wheat back months are lagging so the spreads have been falling back today.
 
Closed the disastrous Soybean Meal spread:

Bought 1 Mar 08, Sold 1 Aug ZM Soybean Meal @ -14.50 - CLOSED - LOSS -5.50 which is 550 usd.

This is a typical example of another spread that should have been stopped out a long time ago. It was profitable a few weeks after entry on May 21st, but since then it's trended beautifully in the wrong direction.

I'm a bit short on time, so I'll be quick:
* Poor execution - could have saved 0.50 there, but there was a slight case of capitulation on my part
* Exited 2 days later than planned - I've been chasing with limit orders for more than a week now, at least 200 usd stems from that.
* I'm glad it was only 1 contract on, and if it was more I probably would have paid a bit more attention to it - I didn't take it seriously enough. However, it's proof that discipline must be maintained at all times.

I also entered a new position:

Bought 1 Dec, Sold 1 May 08 HO Heating Oil @ 0.1000

I made a mistake on order entry, and got a fill that was about 0.0100 (or 420 usd) too high for the market. My profit target is 0.0650 so it's a bit bad. I am looking to add another contract in the next week or so.
 
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