Finance Blog 

Analysen der Finanzmärkte sind auf keinen Fall eine Empfehlung zum Kauf oder Verkauf eines Wertpapierproduktes. 

I have been listening to a couple of business podcasts lately, particularly for leadership skills, communication, ethics and HR purposes. I want to recommend my blog readers the Stanford Business School Podcast, "Think fast, talk smart" which I will embed for free here on my blog.

Since the digitalization has become the number one standard for education, there has also evolved a wide variety of very high quality free content, especially through YouTube videos and podcast, which are easy to listen to during other daily activities. So if you are eager to understand more about the world of business and finance, you can start right here by listening to featured podcasts! Choosing university's channels ensures the quality, so you don't fall into the trap of listening to some bragging idiots about the finance educational world. You can actually choose the best university's and listen to all their podcasts and lear a couple new things every day.

Schauen wir einen Moment auf die Statistik im Januar 2022 an den Weltmärkten und berichten die Auffälligkeiten:

  1. Die Volatilität ist im Januar alleine um fast 30% angestiegen.

  2. Durch die Kriegsgefahr im Osten Europas hat sich der Preis für Natural Gas um über 20% in einem Monat verteuert. Man stelle sich vor wieviel mehr Geld dies für die großen Exporteure des Rohstoff ist.

  3. Es gibt sehr viele Berichte über mehr Inflation, ich denke jedoch nun das es eventuell sogar übertrieben wird. Vor 6 Monaten hielt ich einen spannenden Vortrag zum Thema Inflation.

  4. Technologiemärkte haben an Wert verloren, ziemlich viel sogar: Die Nasdaq ist über 12% im Minus. Es gibt also eine Aversion gegen Risikofreude am Markt.

  5. Am besten von allen wichtigen Futuresmärkten performten Rohstoffe im Lebensmittelbereich im Januar 2022

Today we are blogging about commodities tradable on major exchanges and analyzing their futures prices on different time series.

Monthly statistics of major commodities prove again, that commodities are an often NOT considered asset class in the typical asset management model for stocks and bonds continues to extremely outperform in such an global inflation risk environment. The CAPM model is not state of the art anymore, in my point of view. In this blog post you will find out why.

Lets take a look at 3-4 historical time series data prices with correlations of those considered commodities in such an extreme fundamental situation with high valued stock market prices and recently trending volatility, or at least some bursts in vola. We can hardly explain many factors driving higher prices in combination, this is why different dynamics of trends existing across many asset classes and also the underlying variance can easily be missunderstood. The variance and covariance of those movements of any index pricing is very much relevant for traders and any financial companies, and also for importing and exporting as well as producing companies. Simple stochastic indicators like bollinger bands, ATR and Moving Averages won't do it to understand the complexity behind the trend dynamics in today's markets.

We can visualize the price dynamic well looking at a combination of prices with differenct views of data using this website:

When clicking MTQ view, you can easily see the performance of the underlying futures prices of different markets and with a few clicks compare the prices over different time frames such as weekly and monthly.

currently we see a trend in major commodities, eg weekly:

soja beans: +22%

cotton +8%

rice +6%

corn +4%

Oranges juice prices and many more....

Sugar prices are lagging in this asset class sector. will it rotate in it s segment and move up? we can't predict it. However there sure are some pairs trading algorithms out there, which would do something similar to this.

Interesting monthly stats for agriculture futures, not considering any heating products such as gas within commodities, neither metals such as gold due to bitcoin alternatives, oil due to the industry dynamics of electro mobility and its underlying fundamental factors for the oil and gas prices. So within this global makro perspective, there would be no inclusion of those commodities sector in a potential trend analysis. In general put covid a pressure on global supply chains, also in the shipping container industry, where the prices of transportation have soared. From an economics perspective a potential inflationary szenario is in the cards, more so in emerging economies that are not that well positioned to stand against such a fundamental health crisis. However the mid european economics system from the EU has been strong and does have a pretty good mechanism in controlling and managing money supply, which in the end plays a decent part of the inflation that appears in EU member countries. There are some countires in Europe and close to their border that are very different to some major GDP outcome producing countries, so specifically the dynamic of those markets shows spreads. This will be something interesting to persue, especially because not all EU member countries or ones who wish to become an EU member have the same currency, so there might be large fluctuations ahead.

We have pre posted on our finance blog about this price dynamics in the last 2 years in german language. If you have interest and questions do not hesitate to contact us.

Nasdaq100 in this month so far down 4,6%. Now we can't predict markets according to science , can we? patterns must be random, because so many factors play a role in it we can hardly understand it.

If one would want to do further research with prices of public tradable markets, one could use the mathematical statistics software R, which is freely available and on Youtube you can find many tutorials relating to "programming in R Studio". Check it out.

#science #markets #assetmanagement #agriculture #environment #statistics

Note: our blog does not provide any recommendation for trading, neither do we sell any financial products. We are just an austrian finance blogger and advisor. if you want to do business in Austria, please do not hestitate to contact us.