Seasonal Commodity Trading with Minimised Risk and Maximised Profit
23.06.2015Company: Amcham
Seasonality is a typical characteristic of most commodities. Thanks to seasonality it is possible to identify annual commodity trades with repetitive seasonal trends. This increases predictability of price movements in a particular period of the year which also increases the level of probability that the commodity trade will result in profit.
Commodity spread trading is more advanced and less risky way of seasonal commodity trading. It is based on a principle of hedged positions, also called covered positions. Commodity spread trading involves buying one commodity with expected seasonal price growth, and selling another commodity with expected seasonal price decline. Such covered positions are less exposed to fundamentals (climate, economic or geo-political influenced) and thus the risk of trading commodity spreads is lower than in case of standard trading.
Commodity spread trading implies minimal time requirements, about 2 hours a week. It is an easy to learn method suitable both for beginner and experienced traders which generates 20-80% profit p.a.
Learn more on seasonal commodity spread trading with minimised risk in a short video at
www.tradeandfinance.eu/en/videos/?catid=komoditni-spready&slg=how-to-profit-from-seasonality
www.tradeandfinance.eu/videa/?catid=komoditni-spready&slg=jak-vydelavat-na-sezonnosti
Example of Seasonal Commodity Spread Trade in May 2015
Provided by Romana Křížová, TradeandFinance.eu
Buy Hard Red Winter Wheat with delivery in July 2015 – Sell Wheat with delivery in July 2015
Trade analysis
- Trade window: trade entry on 30th April, trade exit on 20th May
- 80% Win in last 15 years
- 100% Win in last 10 years
- Low prices in current year – good potential for annual seasonal price increase
- Strong seasonal patterns correlation in seasonal window
- High liquidity
- High RRR – 3.17 on 15 years data history
- $261.67 average profit/year/contract
- Minimal trading capital $10 000 allows to enter the trading position with 2 contracts
Commodity Spread Trade Result:
Profit $675/contract made in 20 calendar days, with a potential risk of $225/contract if applying the TradeandFinance.eu trading method.
Learn successful commodity trading in courses and webinars by TradeandFinance.eu:
Free webinars
Courses and webinars
Biweekly commodity spread markets analysis
Any information provided by TradeandFinance.eu is intended solely for educational purposes related to exchange trading and in no case serves as a particular investment or trading advice.
Investing and trading with financial instruments and commodities in particular involves a high risk. A decision to trade at exchange is a full responsibility of each individual and only he/she himself/herself is fully responsible for his/her own decisions.
Never enter any trade whose nature and rules you do not fully understand. The risk of loss in trading commodities can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. Moreover, results of historical trades are no guarantee of future trading profits.
