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Corn Futures and Options Market

Corn Futures and Options Market. Nov. 5, 2009. Sonik Mandal Guillermo Cubas Matt O’Brien. December 2009 Delivery $3.86’0 today. December 2009 Delivery Corn has come off highs of $4.04 on Oct. 22, but has jumped above 4, 9, and 18 day moving averages.

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Corn Futures and Options Market

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  1. Corn Futures and Options Market Nov. 5, 2009 SonikMandal Guillermo Cubas Matt O’Brien

  2. December 2009 Delivery $3.86’0 today

  3. December 2009 Delivery • Corn has come off highs of $4.04 on Oct. 22, but has jumped above 4, 9, and 18 day moving averages. • Fundamentalists playing little role recently as prices track movement in dollar, crude oil and other markets. • Higher price caused by fund-buying and technical momentum. • Fed kept interest rate to near zero, will weaken dollar further and can cause further rise in corn price. • Only 25% of crop harvested compared to 51% year ago with rain to return next week.

  4. New Portfolio • Gained $645, 21.25% since purchase of second portfolio • Bounced back this week, but would have sold on Tuesday, Nov. 3rd to take profits

  5. Correlated Markets • Higher dollar, lower oil and equities prices have pushed corn down

  6. Greeks for $3.50 Call

  7. Looking Ahead • Sell whole second portfolio for a 21% gain of $630 • Up over 121% for the class • Expect the bull market to run as dollar continues to lose value, crude oil moving up and late harvesting and bad weather (could reach 4.10-4.15) • Recommendation (by analyst Guillermo): Buy 2010 March futures and make money.

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