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Commodities Briefing - Archive | January, 2013

Soaring commodity costs to hit all sectors

Posted on 31 January 2013 by VRS  |  Email |Print

Rising commodity costs this year will leave drinks companies .Producers will continue to face commodity price pressures in 2013. Rabobank’s Global Beverage Outlook study warns that companies must ensure “security of supply” and develop an integrated supply chain to guard against price fluctuations. Manufacturers can no longer afford to focus solely on lowest price when buying commodities, the report said.
As Europe wrestles with economic austerity measures and the US deals with a growing debt burden, the global beverage industry will feel the impact of weaker consumer demand from developed markets and slower growth in emerging markets during 2013. Adding to this global economic headwind is price and supply volatility for key beverage related commodities such as sugar, corn and barley. While prices were generally lower in 2012 than the prior year, the outlook for key commodities in 2013 is still a major concern for all beverage companies………………………………………..Full Article: Source

Divergence in trading of commodities vs stocks likely to last

Posted on 31 January 2013 by VRS  |  Email |Print

Commodities have decisively broken their lock-step with other assets, which lasted from 2008 to 2012, and now lower volatility and an expected end to central bank money printing could ensure the correlation does not return.
The 30-day correlation between the Thomson Reuters-Jefferies CRB commodities index and the S&P 500 equities index has slid to 0.24 from 0.7 in late November. Many commodities markets have seen lacklustre activity and range-bound prices in January, and many investors are opting for equities, which have been buoyed by recovering global growth………………………………………..Full Article: Source

Writedowns near $50 bln as M&A haunts mine CEOs: Commodities

Posted on 31 January 2013 by VRS  |  Email |Print

The world’s biggest mining and steel companies have wiped about $50 billion off project valuations in the past year and the purge is poised to continue this earnings season as managers reassess expensive takeovers.
Anglo American Plc (AAL), Vale SA (VALE3) and Rio Tinto Group (RIO) led the writedowns as declining metal prices, rising project costs and slowing demand forced reviews. Glencore International Plc (GLEN) may write down some nickel and copper assets acquired through its takeover of Xstrata Plc (XTA), Liberum Capital Ltd. has said. BHP Billiton Ltd. (BHP) may trim aluminum operation valuations, according to Goldman Sachs Group Inc. and Sanford C. Bernstein Ltd………………………………………..Full Article: Source

Commodities climb on slow economy and cheap money

Posted on 31 January 2013 by VRS  |  Email |Print

Commodities were up across the board Wednesday, spurred by a lackluster economic report and signs that the government will continue to keep borrowing cheap. Silver for March delivery jumped 99.3 cents, more than 3 percent, to $32.177 per ounce. Gold for April delivery rose $18.90, more than 1 percent, to $1,681.60 per ounce.
That contrasted with stocks, as all major U.S. indexes ended lower. Investors fretted about a government report showing the U.S. economy unexpectedly shrank in the fourth quarter………………………………………..Full Article: Source

Commodities trading becoming more complex

Posted on 31 January 2013 by VRS  |  Email |Print

BP hosted an entertaining table outside the annual conference of the Commodity Markets Council, a US trade group, held in Florida this week. Visitors could sit at laptops and simulate trading WTI oil futures. I made a virtual $409,500 in 10 minutes, a feat that might seem impressive were I not down $100,000 in the first five.
The simple exercise of going long or short crude stood out as an anomaly at a conference where the increasing complexity of trading commodities emerged as a theme. This is posing a challenge both to companies and to regulators seeking to peer more deeply into their trading operations………………………………………..Full Article: Source

Iran crude oil exports rise to highest since EU sanctions

Posted on 31 January 2013 by VRS  |  Email |Print

Iran’s crude oil exports in December leapt to their highest level since European Union sanctions took effect last July, analysts and shipping sources said, as strong Chinese demand and tanker fleet expansion helped the OPEC member dodge sanctions.
Exports rose to around 1.4 million barrels per day (bpd) in December, according to two industry sources and shipping and customs data compiled by Reuters on a country-by-country basis and corroborated by other sources and consultants………………………………………..Full Article: Source

Oil supply should send price south

Posted on 31 January 2013 by VRS  |  Email |Print

Nothing like some good manufacturing figures out of China and Germany to give the oil price a kick along.
Yet you have to wonder how any further rises in crude will help the global recovery rather than just reflecting it. But, don’t worry, the supply picture is looking a lot more rosy, which should mean crude prices start going south again — and perhaps helped by some bad economic news as the year progresses………………………………………..Full Article: Source

Oil options lure banks on calmest WTI since 1996

Posted on 31 January 2013 by VRS  |  Email |Print

The lowest oil volatility in 17 years is pushing down options costs, setting up trades that BNP Paribas SA (BNP) and Commerzbank AG (CBK) say will profit when Mideast supply disruptions send prices swinging again.
BNP in Paris recommends buying contracts that pay should crude advance and financing them by selling bearish puts. New York-based Goldman Sachs Group Inc. (GS) said the drop in oil volatility is “too much too soon.” Commerzbank sees value in bets on Brent climbing toward $130 a barrel………………………………………..Full Article: Source

China accounts for nearly half global coal consumption

Posted on 31 January 2013 by VRS  |  Email |Print

According to new U.S. Energy Information Administration data, China burns nearly as much coal as the rest of the world combined. Coal consumption grew in the country for the 12th year in a row in 2011 and accounted for 87 percent of the 374 million ton global increase in coal use in 2011.
China overtook the U.S. as the world’s biggest carbon emitter in 2007, and became the world’s biggest consumer of energy in 2010. David Frum noted that the statistics make greenhouse gas emission restraint goals posited by the Kyoto Protocol look “obsolete.”……………………………………….Full Article: Source

Water demand for energy to double by 2035

Posted on 31 January 2013 by VRS  |  Email |Print

The amount of fresh water consumed for world energy production is on track to double within the next 25 years, the International Energy Agency (IEA) projects. And even though fracking—high-pressure hydraulic fracturing of underground rock formations for natural gas and oil—might grab headlines, IEA sees its future impact as relatively small.
By far the largest strain on future water resources from the energy system, according to IEA’s forecast, would be due to two lesser noted, but profound trends in the energy world: soaring coal-fired electricity, and the ramping up of biofuel production………………………………………..Full Article: Source

Is gold the answer to Europe’s worst case scenario?

Posted on 31 January 2013 by VRS  |  Email |Print

Having seen the Arab Spring develop and come to a head over the past couple of years, should European countries be worried that some of the same factors, and consequences, could rear their heads closer to home?
With governments seemingly increasingly out of touch with the person in the street, and with the public’s growing distrust of politicians and their attempts to right the financial mismanagement of their predecessors, could rioting on the streets develop into full blown insurrection?……………………………………….Full Article: Source

Major Swiss banks ‘raise bullion holding charges’

Posted on 31 January 2013 by VRS  |  Email |Print

Two major Swiss banks have vastly increased their charges to store bullion, it has emerged. Insiders with knowledge of the situation have informed the Financial Times that UBS and Credit Suisse have ramped up their fees for holding gold by around 20 per cent in an attempt to reduce the size of their balance sheets.
Switzerland has traditionally been regarded by commodities traders as the best place to stash bullion, although this trend may now change as banks in the country are becoming increasingly reluctant to offer “unallocated” accounts………………………………………..Full Article: Source

Gold and quantitative easing: Inflation all over again?

Posted on 31 January 2013 by VRS  |  Email |Print

Perhaps you have heard that the Fed is printing money to get out of the crisis and that such actions cannot possibly end other than in even more money being printed and in the dollar losing its ability to buy you tangible assets. In our essay on gold and the dollar collapse we pointed out that since 1970 the debt numbers have gone up more than 40-fold (!).
In 2002, future Fed chairman Ben Bernanke noted that “the U.S. government has a technology, called a printing press (or today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at no cost.” In keeping with these words, Bernanke has played an important role in the introduction of three rounds of what is known today as quantitative easing (QE) — programs expanding the money supply beyond the usual………………………………………..Full Article: Source

U.S. gold, silver production down in 2012—USGS

Posted on 31 January 2013 by VRS  |  Email |Print

The “2013 Mineral Commodities Summaries” released by the U.S. Geological Survey Tuesday revealed that, in 2012, the estimated total value of U.S. mineral production increased for the third consecutive year. The estimated value of mineral raw materials produced at U.S. mines was $76.5 billion, a slight increase from $74.8 billion in 2011, according to the USGS.
Estimated total value of U.S. metal mine production in 2012 was $34.9 billion, down 3% from 2011. Principal contributors to the total value of metal mine production last year were gold (36%), copper (27%), iron ore (15%), molybdenum (10%), and zinc (4%). Average prices for most domestically mined metals decreased in 2012………………………………………..Full Article: Source

Investment demand to be key variable for Silver prices in long term

Posted on 31 January 2013 by VRS  |  Email |Print

The amount of investment demand will be one of the key variables for silver in the long term, said CPM Group while releasing the 2013 update to its Silver Long-Term Outlook market study.
The report provides an analysis of global mine production, secondary supply, fabrication and investment demand, inventory levels and prices. The report looks out through 2022 and is an update to a 2011 report………………………………………..Full Article: Source

UBS, Credit Suisse adjusting precious metals account charges

Posted on 31 January 2013 by VRS  |  Email |Print

UBS AG (UBSN) and Credit Suisse Group AG (CSGN), Switzerland’s biggest banks, are adjusting precious-metals charges for financial institutions. UBS revised fees for unallocated accounts and offers an alternative physical account that has “a lower fee structure,” it said in an e-mailed statement. Both banks didn’t give specific details.
The Financial Times reported earlier that the banks are trying to encourage holding metal through allocated accounts, where they would act as custodian and wouldn’t need to increase capital reserves. That’s instead of holding metal through unallocated accounts, which show up on balance sheets………………………………………..Full Article: Source

ETF cheat sheet: Precious metals

Posted on 31 January 2013 by VRS  |  Email |Print

Precious metals are one of the rarest and most valuable commodities in the world, making them a popular investment tool for long-term buy-and-hold and short-term investors alike. Typically, this asset class has appeal as a safe haven, since its returns are generally greater in periods of high market volatility.
Besides the commodity’s inherent use as a store of value, precious metals are also used in a number of manufacturing applications. Although gold is perhaps the most popular precious metal, palladium, platinum, and silver are also viable and potentially lucrative options to round out a portfolio’s commodity exposure……………………………………….Full Article: Source

Choosing the right ETP for copper exposure

Posted on 31 January 2013 by VRS  |  Email |Print

If you’ve been looking to add metals to your portfolio lately, you might be confounded by the variety of exchange-traded options that offer exposure to the market. Let’s shine some light on this pocket of the investment market. There are many metals to choose from, but I’ll focus on copper to simplify the comparison of the advantages and disadvantages of each investment approach.
All of the following are viable exchange-traded products that offer exposure to the copper market, but they do it in different ways that result in significant exposure and return differences. So, it’s important to understand the various products in order to match your investment thesis with the right product………………………………………..Full Article: Source

IKEN Capital rolls out high-performing commodity fund

Posted on 31 January 2013 by VRS  |  Email |Print

Commodity funds have mostly been a graveyard for investment returns since 2009, yet London-based asset manager IKEN Capital’s new fund has bucked the trend in its first six months.
Using a combination of algorithmic and relative value strategies while hedging out macroeconomic risk, the Commodity Alpha Fund is up over 7 percent since its “soft” launch in June 2012, having navigated tricky third and fourth quarters in which many commodity funds were hard hit………………………………………..Full Article: Source

Deutsche bank names internal co-heads of commodities

Posted on 31 January 2013 by VRS  |  Email |Print

Deutsche Bank has appointed Louise Kitchen and Richard Jefferson as co-heads of its global commodities business, a source close to the bank said on Wednesday. Both are internal appointments and are based in London. Kitchen had been global head of commodity structuring while Jefferson was head of commodity sales.
They will take over immediately from David Silbert, who is leaving the post, said the source, who declined to be identified………………………………………..Full Article: Source

Dollar gains as riskier currencies falter

Posted on 31 January 2013 by VRS  |  Email |Print

The US dollar rose against its leading counterparts as risk-related currencies pulled back from recent highs while the UK pound was a notable underperformer.
Sterling hit its weakest level in more than five months against the dollar amid negative sentiment on the UK economy after figures released on Friday showed a sharper-than-expected contraction in growth in the fourth quarter of last year………………………………………..Full Article: Source

Shenzhen Exchange prepares for backlash as carbon trading starts

Posted on 31 January 2013 by VRS  |  Email |Print

Emitters in the Chinese city of Shenzhen may choose to relocate as the city introduces a cap- and-trade program to limit greenhouse gases.
Companies may go elsewhere as the cost of their carbon emissions cuts profitability, Ge Xing’an, vice president at the Shenzhen Emission Exchange, said yesterday at a conference in Hong Kong. Ge predicts the fallout from businesses leaving would be offset by new companies that can benefit as emitters try to reduce greenhouse gases linked to climate change………………………………………..Full Article: Source

Obama talks climate change. California is acting on it

Posted on 31 January 2013 by VRS  |  Email |Print

It’s not the happiest time to be an environmentalist. Climate change hit home last year with brutal force: 2012’s historic drought singed much of the Midwest, turning farms to dust and withering the corn crop. Other parts of the U.S. suffered through storms like Sandy and massive wildfires.
Average annual temperatures in the continental U.S. beat the previous recorded high by a full 1°F (1.8°C). And the future is uglier still: over the weekend, British economist Nicholas Stern warned that climate change could be even worse than he predicted in his sobering 2006 report on the financial impact of warming, while on Jan. 28 the National Oceanic and Atmospheric Administration released a draft report outlining the serious threat sea-level rise poses to the coastal U.S………………………………………..Full Article: Source

The commodity investor: How will the debt ceiling impact commodities?

Posted on 30 January 2013 by VRS  |  Email |Print

For the second time in less than two years, the United States is facing a debt-ceiling calamity. In this installment of The Commodity Investor, we will discuss the debt ceiling and then examine what impact, if any, it will have on commodity markets.
The US, just like any other country in the world, issues debt in order to finance its existing operations and meet its current legal obligations. These legal obligations include paying back holders of its debt (in the form of bonds issued by the treasury department), paying for services such as Social Security and Medicaid, issuing tax refunds, paying government employee salaries and more………………………………………..Full Article: Source

Commodities advance as bonds decline on confidence; Won rebounds

Posted on 30 January 2013 by VRS  |  Email |Print

Commodities rose a second day, while bonds declined, after reports from Germany to Australia signaled improved confidence. European equity futures were little changed after Asian shares gained the most in a week.
The S&P GSCI Index of raw materials rose 0.2 percent as of of 7:26 a.m. in London, as oil and copper climbed. Euro Stoxx 50 Index futures added 0.1 percent, while contracts on the Standard & Poor’s 500 Index were little changed after the gauge yesterday dropped for the first time in nine days. The MSCI Asia Pacific Index added 0.9 percent. U.S. Treasuries remained lower and bonds across the Asia declined. South Korea’s won snapped a four-day slide………………………………………..Full Article: Source

Scotiabank’s commodity price index retreats in December

Posted on 30 January 2013 by VRS  |  Email |Print

The Scotiabank Commodity Price Index declined by 4.6% month-over-month (m/m) in December, reflecting a sharp drop in the Oil and Gas Index (-14.6% m/m).
“Western Canadian Select (WCS) heavy crude oil led the decline, plunging from US$72.47 to a mere US$57.84 per barrel in December,” said Patricia Mohr, Vice President, Economics and Commodity Market Specialist at Scotiabank. “While West Texas Intermediate (WTI) oil prices edged up to US$88.25 last month, the WCS discount off WTI ballooned to US$30.41 and will climb further to US$32.84 in January and US$36.94 in February.” (Press Release)

HSBC: Oil majors at risk from ‘unburnable’ reserves

Posted on 30 January 2013 by VRS  |  Email |Print

Oil and gas majors, including, BP, Shell, and Statoil, could face a loss in market value of up to 60 per cent should the international community stick to its agreed emission reduction targets, analysts at HSBC have warned.
A new report from the banking giant finds that 17 per cent of Norwegian company Statoil’s reserves would become “unburnable” in a world where oil and gas use falls as countries seek to keep carbon concentrations in the atmosphere to 450 parts per million (ppm), the level the International Energy Agency (IEA) estimates is necessary to deliver a 50 per cent chance of limiting long-term temperature rises to 2°C………………………………………..Full Article: Source

Why oil prices are likely to remain high

Posted on 30 January 2013 by VRS  |  Email |Print

Last year was a good year for oil. The price of Brent crude, the global benchmark for oil, remained above $100 per barrel for most of the year. But now, as a new year kicks off, people want to know whether oil prices are headed higher or lower.
It’s certainly an important question. Not just for oil companies, but for consumers and other businesses as well. While it’s true that commodity prices are virtually impossible to predict with a high degree of accuracy, there is compelling evidence that oil prices should remain high………………………………………..Full Article: Source

OPEC daily basket price stands at $110.20 per barrel

Posted on 30 January 2013 by VRS  |  Email |Print

The price of Organisation of Petroleum Exporting Countries, OPEC basket of 12 has risen from $109.88 to $110.20 barrel, according to OPEC Secretariat calculations.
The new OPEC Reference Basket of Crudes (ORB) is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Oriente (Ecuador), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela)………………………………………..Full Article: Source

Oil consolidating in anticipation of big move

Posted on 30 January 2013 by VRS  |  Email |Print

Crude oil has been trading sideways for the past year between the 2011 high and low. The trading range through 2012 has been contracting with a series of lower-highs and higher-lows. Because this pennant formation is taking place after an uptrend is a bullish pattern with $110 and possibly even $140+ per barrel in the next 6-18 months.
If you look at the weekly investing chart of crude oil the key support and resistance levels area clearly marked. A breakout of the white pennant will trigger a move to the next support or resistance level. And judging from the positive economic numbers not only form the United States but globally the odds are increased for the $110+ price target to be reached sooner than later………………………………………..Full Article: Source

Tanker glut worsens on steepening OPEC production cuts

Posted on 30 January 2013 by VRS  |  Email |Print

OPEC’s deepest output cut since the global recession in 2008 is creating the biggest surplus of oil tankers in the Persian Gulf in at least three years and lowering earnings for Frontline Ltd. and other ship owners.
The Organization of Petroleum Exporting Countries reduced daily supply by almost 1 million barrels in the four months through December, equal to one fully loaded supertanker every two days, data compiled by Bloomberg show. Saudi Arabia, Iran and Iraq led the retreat, leaving 24 percent more ships than cargoes in the world’s largest oil-producing region, the most for the time of year since at least 2010, according to weekly surveys of shipbrokers and owners by Bloomberg………………………………………..Full Article: Source

US shale oil boom: A game changer?

Posted on 30 January 2013 by VRS  |  Email |Print

Reports about the US shale oil boom being a game changer have proliferated after the November 2012’s prediction by the Paris-based International Energy Agency (IEA) that the United States will overtake Saudi Arabia and Russia to become the world’s biggest oil producer by 2020 and energy self-sufficient by 2030.
While such rosy predictions play well to the IEA’s audience, which is largely American, they don’t stand up to scrutiny………………………………………..Full Article: Source

China now burning as much coal as the rest of the world combined

Posted on 30 January 2013 by VRS  |  Email |Print

China’s coal use grew 9 percent in 2011, rising to 3.8 billion tons. At this point, the country is burning nearly as much coal as the rest of the world combined.
Coal, of course, is the world’s premier fossil fuel, a low-cost source of electricity that kicks a lot of carbon-dioxide up into the atmosphere. And China’s growing appetite is a big reason why global greenhouse-gas emissions have soared in recent years, even as the United States and Europe have managed to curtail their coal use and cut their carbon pollution………………………………………..Full Article: Source

How to pick the best gold bullion mining stock?

Posted on 30 January 2013 by VRS  |  Email |Print

Many investors in gold bullion have become increasingly worried due to the lack of price appreciation lately. Even though there has been an aggressive monetary policy initiative by the Federal Reserve, gold bullion and mining stocks in the sector have declined.
Obviously, no one can predict the future; it’s impossible to know for sure where gold bullion, or mining stocks in general, will be in the future………………………………………..Full Article: Source

How to invest in gold?

Posted on 30 January 2013 by VRS  |  Email |Print

Gold has been coveted for millennia because of its beauty, rarity and virtual indestructibility. In the current economic climate gold continues to have merit as a store of wealth.
Gold as an investment has grown in popularity in recent years, partly because of the risks posed to our modern global financial and economic systems – it is often seen as a safe-haven in times of crisis. The price of gold bullion fluctuated between $1,500 and $1,800 during 2012………………………………………..Full Article: Source

Swiss banks lose old taste for gold

Posted on 30 January 2013 by VRS  |  Email |Print

The wealthy have for centuries turned to Switzerland as a safe and convenient place to stash their gold. But Swiss banks are now demanding higher fees to accept the world’s bullion, as they seek to reduce the size of their balance sheets.
UBS and Credit Suisse, which dominate the powerful Zurich-based physical gold market, have hiked their charges for holding the metal, according to clients and people familiar with the banks………………………………………..Full Article: Source

Buy silver – the war against the China bears begins

Posted on 30 January 2013 by VRS  |  Email |Print

Silver is finally looking ready for action. And this is as much to do with what my mate and regular Money Morning editor, Kris Sayce, now calls ‘The Doc’s war against the China Bears’. In case you missed it, I’ve kicked off the year by saying the China bears are about to get smoked.
But sounding my China-Bull ‘battle-cry’ doesn’t just mean that industrial metals are on the menu. Because a resurgent Chinese economy is also good for precious metals, including a long-time favourite of mine: silver………………………………………..Full Article: Source

Tin beating all metals on fourth year of shortages: Commodities

Posted on 30 January 2013 by VRS  |  Email |Print

Indonesia, the biggest tin supplier, is poised to ship the least metal in a decade, extending shortages into a fourth year at a time when surpluses are emerging for most other industrial metals.
Sales will drop 24 percent to 75,000 metric tons because most smelters won’t meet a higher purity standard that starts in July and ore reserves are diminishing, according to the median of 13 exporter and analyst estimates compiled by Bloomberg. Prices will rise 17 percent to $28,750 a ton on the London Metal Exchange this year, the median of 14 forecasts shows………………………………………..Full Article: Source

Copper price forecasts for 2013 improve on more balanced market

Posted on 30 January 2013 by VRS  |  Email |Print

HSBC has lifted its forecast for copper prices in 2013 due to expectations of a more structurally balanced market and positive sentiment. Analyst Andrew Keen said in a note to client that the “market remains balanced in our view, and this is enough to keep prices high when sentiment is good.”
The new forecast raises the average cash copper price in 2013 to $8,000 per ton from $7,500. Benchmark three month copper futures on the London Metal Exchange recently breached the $8,000 to hit $8,066 in Monday morning trading………………………………………..Full Article: Source

One third of junior miners to disappear in 2013: Brent Cook

Posted on 30 January 2013 by VRS  |  Email |Print

Senior geologist and co-editor of the Exploration Insights newsletter, Brent Cook, said 2013 will be the year in which a third of the juniors miners currently active will fade, as they simply don’t have viable properties.
Speaking to Cambridge House Live at the International’s Vancouver Resource Investment Conference held last week, Cook said this is really “good news” for investors because it leaves only the quality projects out there “and there is where you want your money to be.”……………………………………….Full Article: Source

Gold assets head for biggest monthly decline since December 2011

Posted on 30 January 2013 by VRS  |  Email |Print

Gold holdings in exchange-traded products are poised for the biggest monthly decline in more than a year as global economic recovery curbed demand for the metal.
Assets contracted 0.8 percent so far in January, the largest decrease since December 2011, according to data compiled by Bloomberg. The holdings, which reached a record in December, dropped to a two-month low of 2,610.272 metric tons………………………………………..Full Article: Source

ETFs mark 20th anniversary: A Look at the market’s hottest new product

Posted on 30 January 2013 by VRS  |  Email |Print

On a cold January day 20 years ago, with the Dow Jones Industrial Average hovering at about 3,300, a team of investors from State Street Bank (STT) unveiled their new creation to the denizens of Wall Street: the SPDR S&P 500 ETF (SPY).
They now describe the launch of the first exchange-traded fund (ETF) on this day in 1993 as “the one that started it all,” calling the debut of the Spider (short for S&P Depositary Receipt) “an investment product that gave people a more precise way to buy and sell an entire index, but could be traded like a stock.”……………………………………….Full Article: Source

Most affordable currency ETFs

Posted on 30 January 2013 by VRS  |  Email |Print

The exchange-traded fund (ETF) industry has grown into a trillion dollar business since the first ETF was launched 20 years ago. Today’s traders and investors have access to a growing number of ETFs, offering exposure to a wide variety of popular and niche markets.
One of these is the currency ETF market, providing exposure to both individual as well as baskets of currencies. Here we will take a look at some of the more popular currency ETFs on the market today……………………………………….Full Article: Source

Brazil ETFs: Should investors buy the gold medals and golden crosses?

Posted on 30 January 2013 by VRS  |  Email |Print

If you look hard enough, you can find a whole lot of things that are wrong with the “B” in BRIC. The country’s GDP growth is virtually non-existent. Government regulatory intervention in both the energy sector as well as the financials segment has been increasing. And Brazil’s currency lost approximately 7% against the dollar on a year-over-year basis, hurting unhedged investment in the nation.
On the other hand, if India, China and Russia can find their way out of the emerging market bear cave, wouldn’t there be reason for some optimism on Brazil?……………………………………….Full Article: Source

Canadian dollar ends higher as commodity currencies rebound

Posted on 30 January 2013 by VRS  |  Email |Print

The Canadian dollar ended higher Tuesday, carried aloft by a general rebound in commodity currencies. The U.S. dollar was at C$1.0024 late Tuesday from C$1.0061 late Monday, according to data provider CQG.
The U.S. dollar had push persistently higher against the loonie in recent sessions after the Bank of Canada said last Wednesday that the prospect of monetary tightening had become less imminent, but stalled around the C$1.0100 mark………………………………………..Full Article: Source

Finance chiefs look to EU to offset carbon risks

Posted on 30 January 2013 by VRS  |  Email |Print

The Coalition’s plans to scrap the carbon price and the lack of detail provided by the government on how Australian and European carbon markets will be linked are discouraging CFOs and treasurers from capitalising on cheap carbon permits in Europe to hedge their liability when carbon trading starts here.
Last week, carbon permits on the seven-year-old EU market plummeted to a new low of around €2.80, before recovering to just below €5………………………………………..Full Article: Source

How to hold fickle commodities in your portfolio

Posted on 29 January 2013 by VRS  |  Email |Print

Commodities are among the most skittish investments. Not only do they react to global economic forces, they can seesaw with supply and demand, China’s voracious appetite for raw materials and the weather.
Since commodities are tangible things that are mined or grown, they are hard to hold and often bought through futures contracts, which have their own peculiarities. Yet what is undeniable about commodities is that they are usually a good tracker of broad economic growth, inflation among producer prices and they run inversely to the dollar’s decline. You should have a piece of them in your portfolio, but you have to be careful about how you hold them………………………………………..Full Article: Source

Commodities’ fate in Chinese and Fed hands

Posted on 29 January 2013 by VRS  |  Email |Print

Commodities are in for some good times, but don’t count your bullion just yet. Analysts at Danske Bank say that strong Chinese growth will set the stage for solid gains in the first half of 2013, but may also prove to be the trigger for a depressing back half of the year.
Mix that with an expected withdrawal of aggressive monetary easing from central banks, and investors should brace for both a boom and bust in the commodity markets in the year ahead………………………………………..Full Article: Source

Commodities prices are falling. Really

Posted on 29 January 2013 by VRS  |  Email |Print

Although it may not be reflected in your supermarket bills, prices for many of the items on your grocery list are in decline on the wholesale level. The trend in the venerable Commodities Research Bureau (CRB) index of commodities futures prices is down since September and down more than 18% since its all-time high set in April 2011.
To be sure, trends change, and within those trends there are periods of movement in the opposite direction. The index is up roughly 1.2% for January thanks to strength in grains such as soybeans and corn. But the argument for food price inflation cannot be made in the futures markets………………………………………..Full Article: Source

Where do the world’s commodities come from?

Posted on 29 January 2013 by VRS  |  Email |Print

A rare glimpse into life at Glencore International Plc was given to users of link-sharing website Reddit recently when an anonymous trader at the Swiss commodities giant — or at least someone claiming to be one — did a Reddit Ask Me Almost Anything.
The trader answered questions ranging from “How much do you make?” to “Would you get fired if they knew you did this?” on the popular “IAMA sub-Reddit,” which has previously hosted numerous celebrities, industry leaders and even U.S. President Barack Obama………………………………………..Full Article: Source

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