Tue, Mar 31, 2020
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

De-correlated agricultural market is good for diversification but not for long-only investing - BlueGold, Dreyfus

Thursday, October 29, 2009

By Benedicte Gravrand, Opalesque London:

It is important to remember that the agriculture market (ags) is much smaller than the energy and other commodities markets, said Olivier Pairault, portfolio manager at the Swiss offices of BlueGold Capital management at yesterday's Jetfin conference on commodities and energy in Geneva. And the other important thing to remember is that it is best to look at the micro trends when dealing with this market - rather than the macro ones.

So this sector has really followed its own path almost completely unaffected by the credit crunch, in its own macrocosm where fund managers worry more about the weather and the producers than what goes on in the financial markets.

To exemplify the de-correlation of ags to other commodities, Pairault quoted sugar, which was subject to two peaks in the 70s and 80s (coinciding with less "stock to use"). This year and last year, stocks to use went down again. Part of the reason is that India's production decreased as the government forced prices down, a deal unfavourable to farmers. Also, stocks of sugar in Asia used to be high, leading to low prices, but not any more. "Sugar may move again into surplus by the end of 2010," he said, "but prices may remain high however."

Pairault commented that speculators do help this market by giving good price for futures (for producers) and helping the market get more supply......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. PE/VC: Unicorns sometimes sting, Private equity at crossroads as rout offers deals, curbs lending, S&P survey shows sagging prospects for private equity[more]

    Unicorns sometimes sting From PIonline.com: Venture capital firms are on a roll. Some 259 U.S. venture capital funds amassed $46.3 billion in 2019, the second highest by amount of capital raised and number of funds since 2006, according to the PitchBook-NVCA Venture Monitor. The biggest f

  2. Study: Three threats to hedge funds, Institutions seeing more private credit risks[more]

    Three threats to hedge funds From All About Alpha: A recent paper by a scholar at Tilburg University and a market participant at Robeco outlines the difficulties that the hedge fund industry has faced over the last decade. These problems arose, at least in part, from the democratization o

  3. Hedge fund Solus to close flagship investment vehicle[more]

    From FT: Solus Alternative Asset Management, one of the best known specialists in distressed investments, is closing its flagship fund after suffering a combination of heavy redemptions and poor performance. The hedge fund, which as recently as November managed $4.3bn in assets, is one of the fi

  4. Coronavirus 'possibly the biggest economic event of all our lifetimes', 'Big short' Michael Burry has a bearish bet and warns of a selling stampede, Investors' Black Death fear driving panic, says Witan Investment Trust chief Andrew Bell[more]

    Coronavirus 'possibly the biggest economic event of all our lifetimes' A former macro fund manager said on Thursday that the economic impact of the coronavirus - which is shaving trillions off the stock market and exerting a domino effect on the world economy - might be even worse than th

  5. Investing: As markets plunge, short sellers make hay, Time to buy, says GMO[more]

    As markets plunge, short sellers make hay From Institutional Investor: Short sellers floundered during the bull market. But as the market tides have turned, so too have their fortunes. "Some people haven't invested in hedge funds for a very long time," said Mark Roberts, owner of sh