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Educational suggestions for ag spread trading?


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Educational suggestions for ag spread trading?

  #1 (permalink)
 Wartrace 
Wartrace,TN usa
 
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I am looking into seasonal spread trading of agricultural futures products.

I am looking for educational material and forums/websites related to seasonal spread trading in beans, wheat, corn and cattle.

So far I have signed up with seasonalgo, bought a few books (Joe Ross) and have been reading the WASDE reports. While Futures Io is a great forum I am looking for something that concentrates on spread trading only.

I normally trade the 6E contract and CL. I am looking for something I can trade on a longer timeframe with lower margin requirements as a "sideline".

I'm somewhat of a "nerd" and feel I could get into watching weather patterns and crop reports in the evening and weekends while not actively trading other futures contracts.

I know that I DON'T know enough to do it now. I am looking for direction in learning. Thank you in advance!

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  #2 (permalink)
 
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 Big Mike 
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Shout out to @SMCJB and @ron99 because they come to mind with this topic. Hopefully they, or others, will have some feedback for you.

Mike

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  #3 (permalink)
 
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 SMCJB 
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Appreciate the mention but I've not traded any Ags, outrights or spreads. I believe your right that @ron99 has experience in this area, the other person to mention is @myrrdin. He has started several good threads including a ' Meats Thread' and a ' Grains and Beans Thread' (and less relevant to this conversation Energies and Metals threads).

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  #4 (permalink)
 myrrdin 
Linz Austria
 
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Wartrace View Post
I am looking into seasonal spread trading of agricultural futures products.

I am looking for educational material and forums/websites related to seasonal spread trading in beans, wheat, corn and cattle.

So far I have signed up with seasonalgo, bought a few books (Joe Ross) and have been reading the WASDE reports. While Futures Io is a great forum I am looking for something that concentrates on spread trading only.

I normally trade the 6E contract and CL. I am looking for something I can trade on a longer timeframe with lower margin requirements as a "sideline".

I'm somewhat of a "nerd" and feel I could get into watching weather patterns and crop reports in the evening and weekends while not actively trading other futures contracts.

I know that I DON'T know enough to do it now. I am looking for direction in learning. Thank you in advance!

Good to see you here !

I am trading grains, beans, and meats for many years. A lot of my trading is seasonal trading, I also look at S&D and at COT data. Seasonal trading was difficult in 2020, as influences of COVID19 were significantly stronger as traditional seasonal effects. But now I begin to look at seasonals again.

The time frame of my trading is weeks or months.

I will write some things on educational materials and my current trades in the relevant threads, to make them available for everybody.

In recent months it has been quiet in these threads, as there was not much response to my posts. But I would be happy to discuss these trades here with others.

Best regards from Austria, Myrrdin

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  #5 (permalink)
 Wartrace 
Wartrace,TN usa
 
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myrrdin View Post
Good to see you here !

I am trading grains, beans, and meats for many years. A lot of my trading is seasonal trading, I also look at S&D and at COT data. Seasonal trading was difficult in 2020, as influences of COVID19 were significantly stronger as traditional seasonal effects. But now I begin to look at seasonals again.

The time frame of my trading is weeks or months.

I will write some things on educational materials and my current trades in the relevant threads, to make them available for everybody.

In recent months it has been quiet in these threads, as there was not much response to my posts. But I would be happy to discuss these trades here with others.

Best regards from Austria, Myrrdin

I recall several issues with the food chain as a result of Covid lockdowns so it makes sense that it was difficult trading seasonal spreads this past year. Right now I am just about two weeks into my "journey". I did take a course on Udemy which as fairly basic but a good starting point. My plan is to take a few months educating myself and start out small (one spread at a time) and see how it goes.

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  #6 (permalink)
 
Kruger's Avatar
 Kruger 
Cape Town South Africa
 
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I do trade seasonal spreads but on a small scale (i.e not high frequency at all) mainly as a part-time hobby. For e.g. during 2020 I had a total of 13 trades (including a 4 month break). Most of my trades are grains and energies although I do some softs and meats too. I subscribe to MRCI and quite happy with them but don't follow their suggestions too closely. I take more careful of note @myrrdin's view and opinions here.
I'll post my trades from time to time and welcome comments etc as part of my own on-going education.
Just to end on a positive note, of the 13 trades I did during 2020 I only hade 2 losses and they were not large at all. I'm posting this not to suggest how good I am (definitely not), but rather as a counter to the numerous comments I have seen criticising futures spreads trading as a mug's game.
All the best and let's keep the candle glowing

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  #7 (permalink)
 myrrdin 
Linz Austria
 
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Kruger View Post
I do trade seasonal spreads but on a small scale (i.e not high frequency at all) mainly as a part-time hobby. For e.g. during 2020 I had a total of 13 trades (including a 4 month break). Most of my trades are grains and energies although I do some softs and meats too. I subscribe to MRCI and quite happy with them but don't follow their suggestions too closely. I take more careful of note @myrrdin's view and opinions here.
I'll post my trades from time to time and welcome comments etc as part of my own on-going education.
Just to end on a positive note, of the 13 trades I did during 2020 I only hade 2 losses and they were not large at all. I'm posting this not to suggest how good I am (definitely not), but rather as a counter to the numerous comments I have seen criticising futures spreads trading as a mug's game.
All the best and let's keep the candle glowing

An important issue regarding profits of spread trading is a relatively cheap broker. Fees obviously are of greater importance than for trading outright futures. This issue gets even more important if you intend to hold the spreads only for a short time.

Best regards, Myrrdin

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  #8 (permalink)
 
Kruger's Avatar
 Kruger 
Cape Town South Africa
 
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myrrdin View Post
An important issue regarding profits of spread trading is a relatively cheap broker. Fees obviously are of greater importance than for trading outright futures. This issue gets even more important if you intend to hold the spreads only for a short time.

Best regards, Myrrdin

Yes fees are always a factor in deciding not only which spreads to enter but also the number of lots/contracts. To what extent would you say the same applies when trading options such as covered calls, strangles, etc? Will appreciate your opinion, as always.

Regards

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  #9 (permalink)
 myrrdin 
Linz Austria
 
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Kruger View Post
Yes fees are always a factor in deciding not only which spreads to enter but also the number of lots/contracts. To what extent would you say the same applies when trading options such as covered calls, strangles, etc? Will appreciate your opinion, as always.

Regards

Regarding options, it depends: For trading ATM options, the relevance of fees is less than for trading OTM options. The percentage of fees compared to your expected profit should be sufficiently small, and for OTM options this can be a challenge.

In case 100 % of your trades make a nice profit fees are never a problem. But obviously this is not the case. If you have a look at your annual statement and see the sum of fees for the most recent year, you might be surprised.

Best regards, Myrrdin

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