Category: INO.com Contributors

Speculators' Risk Assessments Key to Crude Price Changes

Posted on by Robert Boslego

Robert Boslego - INO.com Contributor - Energies


August crude futures prices edged $0.20 higher in the week ending July 12th (to correspond to the data below), closing at $46.80. However, prices are down about 7% since early June when a confluence of events caused supply disruptions in multiple locations.

Crude Oil Prices

Though U.S. crude oil inventories have dropped more than 20 million barrels since the end of April, petroleum product stocks reached a new peak in the week ending July 8th. Continue reading "Speculators' Risk Assessments Key to Crude Price Changes" →

Freeport-McMoRan Could Double Amid Strong Copper

Posted on by Aibek Burabayev

Aibek Burabayev - INO.com Contributor - Metals


Copper advanced 15 cents or 7% higher from my previous post and it looks like we are going to see much more strength as it was just a warming-up.

Chart 1. Copper-Oil Weekly: The Metal Tries To Catch Up Consolidating Crude

Chart 1. Copper-Oil Weekly: The Metal Tries To Catch Up Consolidating Crude
Chart courtesy of tradingview.com

The comparative chart above became a tradition. This time, there are no dramatic changes on it and the only drama here is the failure of crude oil to surpass the first strong barrier at the $50 mark (black dashed horizontal line). Oil has been stuck in a $5 range between $45 and $50 levels. We are at a crucial point as soon we will know for sure if it was a strong correction in oil before another huge drop to the $26 low or below or is it a consolidation before the break through $50 and then $60 barriers within a new uptrend. Continue reading "Freeport-McMoRan Could Double Amid Strong Copper" →

Gold/Silver Ratio: Halfway To The Target

Posted on by Aibek Burabayev

Aibek Burabayev - INO.com Contributor - Metals


In my February post I called for the topping of the ratio as it hit the upside of the long-term range. The idea was to short gold and buy silver simultaneously at the 79 oz level. It's gone very well, and you can see it in the following charts.

Below is the reconstruction of the February chart to refresh your memory.

Chart 1. Gold/Silver Ratio Monthly: Half Of The Range

Gold/Silver Ratio Monthly
Chart courtesy of tradingview.com

I changed the color of my old remarks to black to stress your attention to the new colored annotations. The post-idea ratio dynamics are highlighted with the orange rectangle. Continue reading "Gold/Silver Ratio: Halfway To The Target" →

The Gang That Couldn't Shoot Straight

Posted on by George Yacik

George Yacik - INO.com Contributor - Fed & Interest Rates


Is a July rate increase back on now because of the strong June jobs report? If not July, then September?

June’s unexpectedly strong 287,000 gain in nonfarm payrolls – more than 100,000 above Street forecasts – has some people believing that the Federal Reserve will now once again change its mind and increase interest rates sometime this summer, either later this month or at its September conclave.

But the bond market isn’t buying it, and neither am I. The yield on the benchmark 10-year Treasury note ended last Friday at a new record low of 1.36%, down eight basis points for the week. That doesn’t sound like bond investors believe that a rate increase is imminent. And it’s hard to believe that the Fed, which won’t make a move unless the sun, moon and stars are in perfect alignment, will suddenly take the big rebound in nonfarm payrolls as the green light to raise rates. It will take a lot more than that. Continue reading "The Gang That Couldn't Shoot Straight" →

Supercharging Portfolio Returns - Empirical Options Data

Posted on by The INO.com Team

I’ve written many articles highlighting the advantages options trading and how this technique, when deployed in opportunistic or conservative scenarios may augment overall portfolio returns while mitigating risk in a meaningful manner. Options trading in layman’s terms can be described as a parallel to owning a rental property. One owns an asset that he is willing to leverage in the form of a tenant occupying his home for monthly rent. In the case of options trading, one owns shares and he is willing “leverage” these shares for “rent” or in the case of options, a premium. In this scenario, the owner of the home gives the tenant the option to buy the property or rent to own if he/she desires prior to a specified date. For the owner of the stock, he is providing the option to buy the underlying security at a specified price on or before a specified date. From the renter’s perspective, if the home value is increasing and the housing market is strong and on an uptrend, the renter would exercise this option and elect to buy the home. In the case of options trading, the renter of the stock would exercise the option to buy the shares if the shares rise significantly and lock in the lower, agreed-upon price. In the housing scenario, the renter elected to have the option to buy however didn’t have the obligation to purchase the home. The tenant witnessed home values increasing and decided to exercise the option to buy and capitalize on the rent he was already paying into the property. For the renter of the stock, the renter had the option to buy the underlying shares however he didn’t have the obligation to purchase these shares. The renter of the shares witnessed the stock take off and decided to exercise the option to buy and capitalize on the “rent” he had already paid into the option contract. As the owner of the property/stock, the ideal scenario is to own the property/stock and continuously collect rent/premiums on a monthly basis without relinquishing the property/stock. I will provide an overview of my empirical case study based on my options activity during Q2 2016 (Table 1). Here, I’ll provide details focusing on optimizing stock leverage via covered calls. Emphasizing the ability to sell these types of options in an opportunistic, aggressive and disciplined manner to generate liquidity while accentuating returns and mitigating risk via empirical data. Continue reading "Supercharging Portfolio Returns - Empirical Options Data" →