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Commodities Briefing - Category | Investment more

Has Gold Become a Bad Investment in India?

Posted on 19 August 2014 by VRS  |  Email |Print

Indians love gold, they cover their brides and shower their temples with the precious metal, traditionally used as a sparkling insurance policy and inflation hedge to be cashed in when needed. While the South Asian nation is the world’s second largest consumer of gold after China, it seems to be losing some of its appetite for the precious metal as an investment.
Demand for gold in India fell 39% from a year earlier in the quarter ended June to 204.1 tons, the World Gold Council said last week. Investment demand — buying of gold in the form of coins or bars rather than jewelry — plummeted even further, losing 67%………………………………………..Full Article: Source

Gold investors eye EU’s next move

Posted on 18 August 2014 by VRS  |  Email |Print

Gold moved higher in the initial part of the week and closed lower on Friday as news of the EU reviewing the sanctions on Russia began to surface. At $1,304.7 per troy ounce, gold was down 0.3 per cent for the week. It was trading at $1,319.3/ounce on Thursday.
The number of people filing for jobless claims in the US rose more than expected last week. The US Labour Department reported that the claims rose to 3,11,000, against the expected 2,95,000. Weak economic data from the Euro Zone also helped gold prices inch up………………………………………..Full Article: Source

Calling all nervous investors! The case for commodities

Posted on 13 August 2014 by VRS  |  Email |Print

As geopolitical risk and fears of stock market falls continue to loom large, some investors believe now may be the time to back commodities – despite the woeful returns from the asset class over recent years. Commodities have performed poorly since 2010, with the Bloomberg/UBS Commodity index falling 30% over that period. And while the index rose 7.1% in the first half of 2014, its best start to a year since 2008, a difficult July saw many of those gains evaporate.
But as fears of a market correction gain ground, with some seeing the FTSE 100’s weakness over the last fortnight as a prelude to a further falls, some are taking a shine to commodities, which traditionally have shown a low correlation to broader markets. Their resilience in times of geopolitical stress is adding to their appeal, as tensions persist between Russia and the West and the US conducts air strikes in Iraq………………………………..Full Article: Source

Aluminium in Gulf to reach $55bn by 2020

Posted on 13 August 2014 by VRS  |  Email |Print

Gulf region’s investments in the aluminium sector are forecast to reach $55 billion by 2020, compared to $30 billion in 2011, thanks to smelters’ expansion and new projects in the region, according to organisers of Aluminium Middle East exhibition.
Statistical data shows that the Gulf aluminium industry is growing by 8.4% annually, compared to an average annual global expansion of 3.5%, making the Middle East the fastest growing aluminium market in the world, said the event organisers who cited figures by Harbor Intelligence, a firm specialised in global aluminium market trends, analysis and forecasts………………………………..Full Article: Source

Commodities: Has Their Time Come Again?

Posted on 12 August 2014 by VRS  |  Email |Print

Ever since the Great Recession, it’s been a mixed bag for investors in natural resources. Though driven by the expanding emerging world, prices for commodities — with the exception of energy — haven’t really approached their pre-recession highs. From lower growth in key markets like China to oversupplies of several metals and minerals, commodities as a whole have been a terrible place to park your money over the last three or four years.
That could make them an ideal bargain play. Aside from their diversification benefits, the overall stronger global economy has some of the supply-demand dynamics finally working in investors favor. And after the recent slide in risk assets, the time to buy could be now……………………………………Full Article: Source

Silver: Investing Essentials

Posted on 12 August 2014 by VRS  |  Email |Print

Mankind has been mining silver for more than 5,000 years. It is believed to have first been mined in what is now Turkey. Through the centuries it became an important trading component especially along the Asian spice routes. Today, silver is not only important for the value it holds but for the vast array of usages derived from its versatility.
What is silver and why is it important ?: Silver is a soft and shiny metal that has the highest electrical and thermal conductivity of all the metals, as well as being the most reflective……………………………………Full Article: Source

Investors warm to commodities in search for return

Posted on 07 August 2014 by VRS  |  Email |Print

Global uncertainty, coupled with the strength of the Chinese markets, is leading U.S. investors back into commodities. Investors put more money into commodities ETFs and ETNs in July than they have in any single month over the past two years, according to ETF.com., which provides research on exchange-traded funds and exchange-traded notes.
The lift came as Chinese markets — and, in many cases, the funds tracking them — notched their best gains since late 2012, raising hopes that the world’s second-largest economy will support demand for the industrial metals used to manufacture cars, buildings and consumer electronics bought by the country’s growing middle class………………………………………..Full Article: Source

Are commodities’ days of true diversification behind them?

Posted on 07 August 2014 by VRS  |  Email |Print

The ability of commodities to offer uncorrelated returns has historically given them status as an important diversifier, but has this reputation been irreparably damaged by structural change in the years since the financial crisis?
Before 2009 correlations between commodity prices and stock markets were close to zero, cementing their reputation as reliable portfolio diversifiers. While gold is a more obvious diversifier, other precious metals, industrial metals, oil and agricultural commodities continue to be used to broaden a portfolio’s mix from stock, bonds and cash………………………………………..Full Article: Source

Gold Investors Shouldn’t Fear Rising Interest Rates: Here’s Why

Posted on 07 August 2014 by VRS  |  Email |Print

Investors commonly assume that rising interest rates adversely impact the gold price, and vise versa. They believe that a rising interest rate environment is indicative of a strong economy, which is supposed to drive investors out of gold and into the stock market. They further assume that investors will want to exchange their gold, which has no yield, for stocks and bonds, both of which have yields and generate income.
But this intuition is unfounded, at least when tracking the Fed Funds Rate since the Nixon abandoned the gold standard (i.e. after August 15th, 1971). Since then, a rising Fed Funds Rate has usually coincided with rising gold prices, and vise versa………………………………………..Full Article: Source

4 Reasons To Invest In Silver Rather Than Gold

Posted on 05 August 2014 by VRS  |  Email |Print

With Wall Street and a number of institutional investors like Ray Dalio and billionaire George Soros placing big bets on a recovery in precious metals, now is likely the time for investors to take the plunge. But the key question remains, which precious metal should they choose?
Gold has remained a firm favourite among investors and Mr. Soros has made a massive US$120 million plunge on the world’s largest gold producer Barrick Gold Corporation. However, my preference is to invest in Silver and not gold. Not only does it share similar characteristics to gold, including acting as an inflationary hedge, being a well of value in uncertain times and a safe-haven asset, it possesses four unique characteristics which could propel its price skyward………………………………………..Full Article: Source

Don’t ignore precious metals

Posted on 01 August 2014 by VRS  |  Email |Print

What is hard about investing? It’s not the simple mechanics of investing. Nowadays if you have the money, it’s easy to open an online trading account and start trading. You don’t even have to talk to anyone usually, just mail in a check to the broker and off you go. So the how or mechanics of investing is not hard.
Is finding what to trade hard? This is an interesting question. I would submit that finding what to trade is not the hard part about investing either. Studies have shown that selecting stocks at random, a.k.a. monkeys throwing darts at a dartboard, have outperformed market averages in a wide variety of years. But this is only because stocks as an asset class tend to move in the same direction, creating bull and bear market trends over time………………………………………..Full Article: Source

Common-Sense Commodities Investing

Posted on 01 August 2014 by VRS  |  Email |Print

To most investors, investing in commodities seems hopelessly complicated and treacherous. My first visit to the commodity trading pit of the Chicago Mercantile Exchange (CME) was memorable. The swirling, bright-colored jackets and the shouting, jostling, and rapid hand signals were captivating and reminded me of a wrestling ring rather than a business setting.
It was also the polar opposite of my later visit to the currency trading floor of JP Morgan at 23 Wall Street: row after row of white shirts hunched over flickering computer screens………………………………………..Full Article: Source

Investors not enthused by improving health of Commodities: Barclays

Posted on 31 July 2014 by VRS  |  Email |Print

A Barclays report says the current year witnessed an improvement in the health of commodities but investors have continued to withdraw assets from commodity investments on a quarterly basis. The slow pace at which institutional investors are able to take and implement the kind of long-term investment decisions and make allocations to commodities is the major reason for this trend. But the situation is expected to improve gradually, the report said.
The report maintains key recommendations as: long crude oil; short gold (due to weak fundamentals); and long nickel – the base metal with the best short-term fundamentals and a sector likely to benefit from better global growth in this quarter………………………………………..Full Article: Source

Stephanie Flanders: Now is the time to invest in commodity stocks

Posted on 25 July 2014 by VRS  |  Email |Print

Stephanie Flanders, chief market strategist at JP Morgan Asset Management, believes that now is the time for investors to back commodity companies. She commented that while ‘it is too early’ to call the bottom of the commodity cycle, commodity stocks should still play an increasing role in investors’ portfolios because of the diversification they offer.
Flanders noted that 2014 has seen strong returns for commodities, with the Bloomberg/UBS Commodity Index having returned 7.1 per cent so far this year………………………………………..Full Article: Source

Investors swap grains for metals as flows trickle to commodities

Posted on 22 July 2014 by VRS  |  Email |Print

Investors are slowly being drawn back into commodities, attracted by stronger global economic growth and more volatility within sub-sectors, typified by current investment flows out of grains into industrial metals.
The sector has been shunned in recent years, knocked by poor returns during the financial crisis which saw commodities move in step with other assets. Commodities has benefited this year after China unleashed stimulus measures to prop up growth and recovery took hold in the United States………………………………………..Full Article: Source

Investing in Water

Posted on 22 July 2014 by VRS  |  Email |Print

Water scarcity is making headlines, particularly as a drought savages California, and heightened tensions about water supply and use won’t evaporate any time soon. Whether it is concern about climate change, global population growth or the need to revamp aging water infrastructure, investment advisers say the water sector offers long-term buying opportunities. However, they add, carefully review the type of investment since offerings are as vast as the ocean.
It has become easier to add water investments to a portfolio. Some water utilities are publically traded, as are a few agricultural producers, and a handful of exchange-traded funds have bubbled up to make it simpler to get broad sector exposure. Farmland remains another way to get water ownership………………………………………..Full Article: Source

How to Invest in the World’s Most Precious Commodity: Water

Posted on 18 July 2014 by VRS  |  Email |Print

When asked what the world’s most precious commodity is, most people would rattle off guesses from a list of the usual suspects — things like gold, platinum, oil or diamonds. However, there is a commodity more precious than any of those, one that has the potential to rise in value dramatically over the next decade, and one that you can easily invest in.
If you want to know what it is, just watch any episode of a survival reality show. Whether it’s “Man vs. Wild,” “Survivorman” or even “Naked and Afraid,” the first thing the TV survivalists do after assessing their situation is to look for this precious commodity — clean, drinkable water………………………………………..Full Article: Source

Commodities luring investors

Posted on 14 July 2014 by VRS  |  Email |Print

Investors are being lured back to commodities after war and drought helped make raw materials the surprise best-performing major asset class in the first half. About $5.9 billion was added to raw materials investments this year, compared with a record $50 billion withdrawn in 2013, Citigroup Inc. estimates. Assets under management of about $360 billion at the end of last year rose to $365 billion through May and probably increased again in June, the bank said Monday.
While Citigroup and Goldman Sachs Group Inc. forecast in January that prices would fall or remain steady this year, Middle East unrest and pledges by central banks to keep interest rates low sent gold up 11 percent and boosted oil to a nine-month high. Lack of rain in Brazil lifted coffee 58 percent, helping commodities record the best first half since 2008………………………………………..Full Article: Source

Goldman Stays Gold Bear as Bullish Wagers Increase: Commodities

Posted on 14 July 2014 by VRS  |  Email |Print

Goldman Sachs Group Inc.’s Jeffrey Currie isn’t backing down from his bearish call on gold. As bullion’s 11 percent rally this year beats gains for equities, commodities and Treasuries, he’s sticking with the view that the metal will be lower by the end of December as the economy improves.
Currie, who last year got ahead of the biggest gold collapse since 1980, is an undeterred bear even as hedge funds add to their bullish holdings for a fifth straight week and assets in exchange-traded products advance………………………………………..Full Article: Source

The Best Way to Invest in Silver

Posted on 11 July 2014 by VRS  |  Email |Print

Mining is highly cyclical, with commodity prices rising and falling in long-term trends. For Foolish investors, these cyclical industries allow for classic value investing, with the market offering great companies at deep discounts that can yield market-crushing long-term total returns. This article highlights silver and explains the long-term bullish case for the precious metal.
More importantly, it offers a low-risk way for long-term investors to profit immensely should silver prices soar. Silver has many important uses other than jewelry or a store of value that can justify long-term price appreciation………………………………………..Full Article: Source

Is it Time to Put Precious Metals in Your Portfolio?

Posted on 11 July 2014 by VRS  |  Email |Print

Many experts have been calling “game over” for more than a year, yet the stock market continues reaching new highs. And while the “average length” of a bull market is quoted as being anywhere from four to nine years or more – the experts can’t agree on that either – at five years at counting, many believe the current bull market is at least approaching retirement.
And that always brings out the promoters of a precious metal play. Is it time to put a little gold or silver in your portfolio? In a typical Wall Street hedge, Russ Koesterich, chief investment strategist for BlackRock says yes – and no………………………………………..Full Article: Source

Is investing in gold a good decision?

Posted on 10 July 2014 by VRS  |  Email |Print

Is this is a ‘golden’ opportunity? There is so much media glare on equities that investors have little opportunity to evaluate other options. The perceptive investor however, does not focusing on the media. He wants to know if there is any opportunity out there that he may be overlooking; perhaps an opportunity in gold?
It is normal for investors to think a little contrarian at this stage. Everyone is talking of equities hence they are looking for something other than equities that has not quite shot up to the same extent. Enter gold………………………………………..Full Article: Source

Is Now The Right Time to Buy Silver?

Posted on 10 July 2014 by VRS  |  Email |Print

Silver is indeed a gentleman’s currency. However, it has been two years of downside pressure for investors in silver, but I have recommended accumulating it heavily once it dipped under $23 an ounce and almost took to the streets to encourage buying at $18 an ounce. I have been buying silver at a strong clip.
Prices have now come back and stabilized around $21 and it is likely just the beginning. Inflation is slowly — very slowly — starting to creep up in corners of the world, and that is a nice source of upward pressure for the metal. Still, we are a long way from $50 per ounce. Is now a good time to buy silver? There are key supply and demand issues that you need to be aware of and several ways to play the metal………………………………………..Full Article: Source

Good returns bring investors back to commodity ETFs

Posted on 09 July 2014 by VRS  |  Email |Print

The best commodities performance in years has rekindled interest in exchange traded funds that allow investors to trade the price of energy, metals and grains on stock markets. At one time, some ETFs were so large that critics contended they distorted wholesale markets for food and energy. Assets held in many of the biggest funds have shrunk from their peaks.
But new figures show investors began to creep back into commodity ETF products as the benchmark Bloomberg Commodity Index rose 7.1 per cent in the first half of the year. The direction of flows varied by geography and sector, however……………………………………Full Article: Source

Why commodities belong in your retirement portfolio

Posted on 04 July 2014 by VRS  |  Email |Print

The recent turmoil in Iraq led many forecasters to predict that oil and gasoline could be headed for a substantial price increase. Jay Leno once joked, “Gas prices continue to rise. At the gas station near my house they have a slot for your credit card and one right next to it for your 401(k).”
The price of oil can be very volatile. Oil prices have a history of price spikes that are associated with geopolitical unrest. In 1979, the price of crude doubled to $38 per barrel. Using an inflation adjustment based on CPI data from 1946-2014 that equates to over $115 per barrel in today’s dollars. Oil spiked again in 1990 during the Gulf War. In June 2008 oil reached an all-time high when it averaged an inflation-adjusted price just over $135 per barrel for the entire month………………………………………..Full Article: Source

Gold Investing Sentiment Hits 4.5-Year Low

Posted on 02 July 2014 by VRS  |  Email |Print

Gold investing amongst private households sank to the weakest sentiment in nearly 4.5 years in June. Bulls can blame last month’s jump above $1300 per ounce. It spurred the number of sellers on Bullion Vault – the world’s largest physical gold provider online – and deterred new buyers. That took our Gold Investor Index down to 51.2, the lowest reading since February 2010.
The Gold Investor Index is a unique window onto private investing behavior in gold. Unlike an exchange-traded trust fund (ETF), BullionVault has few professional money managers amongst its 52,000 users. Unlike a retailer dealing coins or small bars, we also enable our users to sell their vaulted property instantly, when they choose (and offering it at their own price too if they wish)………………………………………..Full Article: Source

More investors plan to overweight commodities -Credit Suisse

Posted on 27 June 2014 by VRS  |  Email |Print

More investors plan to ramp up on commodities over the next 12 months after years of pessimism toward the sector, betting that the Iraq conflict will push oil prices higher while other commodities prices advance in volatile trade, a Credit Suisse poll showed on Thursday.
The Swiss bank said it found a favorable view developing toward commodities at a conference in New York this week, when it surveyed 350 investors, including institutions, hedge funds, family offices, mutual funds and corporate firms. A year ago, the bank said most investors at a similar Credit Suisse conference expressed reservations on commodities………………………………………..Full Article: Source

Is Now The Time To Buy Commodities?

Posted on 27 June 2014 by VRS  |  Email |Print

For active traders thinking about investing in commodities now could be the time. As you can see from the chart below, the price of the iPath Dow Jones-UBS Commodity Total Return ETN (DJP) has recently bounced off its 200-day moving average. The bullish long-term buy signal is being confirmed by the MACD indicator crossing above its signal line.
These two technical buy signals along with a rising RSI indicator suggests that commodity prices could be heading higher over the months ahead. Aside from the technical chart patterns, price movements of major underlying commodities are also suggests that a move higher is likely in the cards……………………………………….Full Article: Source

Buy gold if it dips to $1,298-1,302/ounce

Posted on 27 June 2014 by VRS  |  Email |Print

Comex gold futures were lower on Thursday, retreating from this week’s two-month high as a firmer tone in equities suggested investors could be switching back into risky assets, abandoning haven gold.
It has struggled to maintain gains, however, as higher prices curbed physical demand and investors stuck to the side lines, awaiting a clearer picture for the US monetary policy. China’s gold imports from Hong Kong dropped in May to the lowest level since January last year as a weaker yuan curbed appetite for the precious metal………………………………………..Full Article: Source

A New Way to Buy Gold

Posted on 26 June 2014 by VRS  |  Email |Print

Despite some truly frightening conflicts in the Middle East and Ukraine, despite signs of inflation in the United States, and despite promises to “print” from both the Japanese and European central banks, the price of gold has barely managed to climb above $1,300 an ounce.
In fact, gold was the worst-performing asset class in 2013 — down 24.8 percent. Yet gold is still the best-performing asset of this century!……………………………………….Full Article: Source

Interest increases for commodities

Posted on 24 June 2014 by VRS  |  Email |Print

Investor inflows into exchange traded products can broadly be divided into two camps: those that look to use mainly ETFs in specific equity and bonds markets for some tactical asset allocation plays, and those that are looking for exposure to specific and niche areas of the market, particularly commodities.
David Patterson, head of UK wholesale distribution for passive investment products at DeAWM, notes: “Once equity markets bottomed out after the 2008 crash, the recovery has seen US equities in particular show tremendous growth. Anyone holding an ETF tracking the S&P 500 for the past five years would have done extremely well – the index is up almost 200 per cent since the market bottomed out………………………………………..Full Article: Source

Investors need to guard against oil price spike

Posted on 19 June 2014 by VRS  |  Email |Print

Investment managers are learning to embrace failure. They have been wrong on two critical calls this year, on bond yields and on oil. As a result, the best friend of hedge fund managers, momentum, has for the time being deserted them. The issue now is to guard against the growing possibility of a true oil price spike.
The first call investors got wrong was on US Treasury yields. They were almost universally expected to rise gently from 3 per cent; instead, they have fallen to as low as 2.5 per cent. That led to drama within the market in spring as investors exited from cyclical sectors that do well when the economy is expanding (and hence bond yields are rising)…………………………………..Full Article: Source

Why Gold Belongs In Your Portfolio

Posted on 18 June 2014 by VRS  |  Email |Print

Gold as an investment is one of the most difficult assets to forecast, predict and understand. Being a commodity, its price can vary rapidly due to events beyond anyone’s control. So why then does gold belong in your portfolio?
Investors use gold as an investment for a variety of reasons. Some investors use gold as a hedge against inflation, others as a hedge against a declining dollar and some as a safe haven during periods of political and economic turmoil. In my opinion, gold is a great portfolio hedge against a significant market recession as seen in 2002 and 2008………………………………………..Full Article: Source

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5 Things to Know Before Investing in Precious Metals

Posted on 17 June 2014 by VRS  |  Email |Print

Precious metals mining is a fickle industry. It changes constantly because of price volatility, market demand, and the costs incurred for capital-intensive projects. Then, there’s always something else that causes mining companies to change plans. Here are five things to consider before investing in precious metals.
1. Price volatility is inherent to the industry: Precious metals prices follow no set pattern or trend. They can swing up or down in a flash. For example, Canadian Mining Journal reported this month that, “A rare combination of ongoing strikes in South Africa’s platinum group metal mines combined with political tensions between Russia and Ukraine have translated into three-year highs for palladium prices in early June, resulting in one of the few bull markets for a mining commodity this year.”……………………………………….Full Article: Source

Are Gold Miners Worth Investing In?

Posted on 13 June 2014 by VRS  |  Email |Print

Gold mining stocks were hammered last year as gold prices fell almost 30%. Investments in gold fell as investors pulled money out of exchange traded funds. This was mainly due to the fact that the U.S. Federal Reserve indicated that it will start winding up its quantitative easing program.
The Fed has already started easing its bond purchases this year, however, surprisingly gold and gold mining stocks have performed well. So are gold miners worth investing in after last year’s sharp decline?……………………………………….Full Article: Source

IEA Investment Report: What is Right; What is Wrong

Posted on 11 June 2014 by VRS  |  Email |Print

Recently, the IEA published a “Special Report” called World Energy Investment Outlook. Lets’s start with things I agree with: 1. World needs $48 trillion in investment to meet its energy needs to 2035. This is certainly true, if we assume, as the IEA assumes, that world economic growth will actually improve a bit, from 3.3% per year in the 1990 to 2011 period to 3.6% per year in the 2011 to 2035 period. It is likely that the growth in investment needs will be even higher than the IEA indicates.
In my view, this is a CYA report. The IEA sees trouble ahead. There is no way that investment of the needed amount (which is likely far more than $48 trillion) can be met. With the publication of this report, the IEA can say, “We told you so. You didn’t invest enough. That is why energy supply ran into huge problems.”……………………………………….Full Article: Source

India: FMC takes steps to restore investor confidence in commodities market

Posted on 09 June 2014 by VRS  |  Email |Print

To revive investor confidence in commodities market that has plummeted after the NSEL crisis, sector regulator FMC has asked the Securities and Exchange Board of India (SEBI) to make it mandatory for listed companies to disclose their exposure in commodities hedging.
The Forward Markets Commission (FMC) has also written to the Finance Ministry to direct banks to insist on borrowers, who have exposure to commodities, hedging their price risks………………………………………..Full Article: Source

IEA warns of looming energy investment shortfall

Posted on 06 June 2014 by VRS  |  Email |Print

A looming energy investment shortfall risks derailing carbon-reduction targets the International Energy Agency (IEA) has warned. In a new report, World Energy Investment Outlook, the IEA said that to meet global energy demand, around $40 trillion will need to be invested by 2035, while a further $8 trillion will need to be spent on energy efficiency.
“The reliability and sustainability of our future energy system depends on investment,” IEA executive director Maria van der Hoeven said. “There is a real risk of shortfalls, with knock-on effects on regional or global energy security, as well as the risk that investments are misdirected because environmental impacts are not properly reflected in prices.”……………………………………….Full Article: Source

Sell gold if it rallies to $1,267-70

Posted on 06 June 2014 by VRS  |  Email |Print

Comex gold futures are seen consolidating in a broad range moving with a bearish bias. As mentioned in the previous update, prices could further accelerate towards $1,245 or even lower to $1,220-25. An immediate target is around $1,220-25 levels. Failure to find support here could be seen a sign of weakness further denting sentiment.
Subsequently, prices have the potential to even test $1,185-90 range. Mild oversold conditions prevailing in charts could see a pullback to resistances in the coming week. Resistances will be seen at $1,260 followed by $1,278 now. Only a move above $1,285 could lessen the chances of the expected decline to above mentioned levels………………………………………..Full Article: Source

Five Reasons Why Indian Investors Are Selling Gold

Posted on 05 June 2014 by VRS  |  Email |Print

Spot gold prices in India are hovering around Rs. 27,000 per 10 gm, the lowest in over four months. The catalyst for the fall has been the recent easing of some import restrictions from the Reserve Bank of India. Also, traders anticipate a further fall in gold prices if the Narendra Modi government decides to rewind some of the import restrictions imposed by the earlier government.
Easing of Import Restrictions: The Reserve Bank of India last month removed some curbs on imports of gold. This led to a fall of Rs. 800 in gold prices on May 22, its biggest one-day fall this year. The RBI expanded the number of private agencies that can import the precious metal while also allowing banks to provide gold loans to the sector………………………………………..Full Article: Source

Mideast investment shortfall may hit oil prices

Posted on 04 June 2014 by VRS  |  Email |Print

A potential shortfall in investment in production in the Middle East could create a $15 increase in the oil price by 2025, the energy arm of the Organisation for Economic Co-operation and Development (OECD) said.
The world will need to invest $40 trillion in energy supply and $8trn on energy efficiency by 2035 to meet growing demand and falling output from mature sources of energy, the International Energy Agency (IEA) said in a report. A large proportion of the investment to increase output will need to come from the Middle East as a rise in non-Opec production such as US shale oil starts to lose steam in the mid-2020s………………………………………..Full Article: Source

Here’s How to Navigate the Commodity Investing Waters

Posted on 03 June 2014 by VRS  |  Email |Print

In the past couple of years, commodities have not been a good place to put your money. However, longer term, they have been outperforming stocks. Since the turn of the century, there are many commodities that have increased several multiples in price:
Oil has risen from $20 per barrel to more than $100 per barrel. Corn has risen from $2 per bushel to nearly $5 per bushel. Gold has risen from $250 per ounce to $1,250 per ounce. Copper has risen from less than $1 per pound to more than $3 per pound. This strong performance is due to a couple of factors. The first is rising demand, particularly from emerging market countries with economies that are growing rapidly………………………………………..Full Article: Source

Global investors show less confidence in Australia

Posted on 03 June 2014 by VRS  |  Email |Print

A new global study shows the US has extended its lead as the country with the most positive sentiment from offshore investors, while Australia has slipped in the rankings.
The closely watched analysis of investor sentiment, from consulting firm AT Kearney, saw Australia dip to eighth spot after being leapfrogged by both the United Kingdom and Germany………………………………………..Full Article: Source

Why Investors Should Consider Silver

Posted on 02 June 2014 by VRS  |  Email |Print

Silver is the one of the world’s most versatile commodities. Also classified as a currency, silver is one of the world’s best conductors of electricity and heat. Its versatility is exemplified by its use in products ranging from electronics, antiseptics, solar panels, silverware and jewellery.
In the commodity ETF world, silver ETF’s have among the lowest expense ratios, notably because silver is a quasi-currency with very low storage costs yet the majority of its demand is for industrial purposes. Demand is increasing rapidly along with increasing global per-capita incomes and rapid electrisation…………………………………….Full Article: Source

Why Investors Might Want To Exercise Caution

Posted on 30 May 2014 by VRS  |  Email |Print

The M&A frenzy in commodity related stocks is not taking place in the E&P plays like we suspected but rather a much more boring segment of the commodity space; food stocks. There is a rush to combine in the sector as companies look to build up scale in order to help in negotiating placement of their products as well as the price they receive.
This is a trend we suspect will continue and based off of all the recent action it appears that the sweet spot of the market is $4-8 billion market capitalization area. We are not speculators in the sector but if we were that is the area of the market we would focus on………………………………………..Full Article: Source

How to Invest in Commodities—and Why You Should

Posted on 28 May 2014 by VRS  |  Email |Print

For the first time since 2010, commodities are showing signs of life. So far this year, a diversified package of commodities is outpacing both the stock and bond markets. But if you hold some of these basic materials in your portfolio—or are tempted to get back in now—you’ll want to be careful about how you ride the turnaround.
Beyond improving performance, there are two good reasons to hold some commodities—or, to be more precise, investments that track the price of commodities. Diversification is one. Research shows that commodities typically don’t move in sync with stocks and bonds, and that’s holding true now………………………………………..Full Article: Source

In Australia, Mining Investment on a Swift Course Downward

Posted on 28 May 2014 by VRS  |  Email |Print

You know that feeling you get when the rollercoaster passes the crest of the hill and begins to accelerate downward, almost vertically? Welcome to the Australian economy — at least the investment component of it.
Australia is facing what has been dubbed a “capital expenditure cliff,” which essentially marks the moment when the gentle decline in mining investment over the past year gathers sudden, alarming speed. Data on first-quarter investment, due Thursday, is expected to show total business investment fell 1.5% from the fourth quarter, according to a survey of 15 economists by the Wall Street Journal………………………………………..Full Article: Source

Trillion-Dollar Question: Are Oil Companies Over-Investing in High-Cost Projects?

Posted on 27 May 2014 by VRS  |  Email |Print

Over the next decade, private-sector companies may invest over $1 trillion to develop new sources of high-cost oil production. Much of this future production will (1) be profitable only if oil prices remain near current (historically-high) levels; and (2) come online at a time when global oil demand may be entering the start of a long-term decline.
Investors in oil producers need to ask: how rigorously do these companies stress-test new projects against scenarios of declining oil demand and diminished oil prices? Last year the world consumed 91 million barrels per day of oil to fuel cars and trucks, heat buildings, make petrochemicals, and generate electricity, among other uses………………………………………..Full Article: Source

India: Commodity investors keep fingers crossed as Modi takes over

Posted on 26 May 2014 by VRS  |  Email |Print

As Narendra Modi gets ready to take over as Prime Minister, investors in the commodity market are a little worried over his views on futures trading.
The reason: in 2011, a Working Group on Consumer Affairs headed by Modi had recommended a ban on futures trading in essential commodities, to control prices. The Working Group was set up in April 2010 by the UPA Government to find ways to control inflation, which had breached the 11 per cent-mark………………………………………..Full Article: Source

Worried Indian investors hasten to sell out gold

Posted on 23 May 2014 by VRS  |  Email |Print

Indian investors are seen in a hurry to sell out their physical gold collection as Modi-led new government has eased gold import duties to boost the precious metal import which is likely to pull down gold prices significantly.
At present, the gold market has thronged with sellers rather than buyers. The anxious investors bring gold bars and coins that they purchased months ago, said Mr. Jitendra Kantilal Jain, proprietor of Jugraj Kantilal and Co., a large dealer in recycled gold in the western Indian city of Mumbai’s Zaveri Bazaar……………………………………..Full Article: Source

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