The hedge fund pattern and oil

The hedge fund pattern and oil

The hedge funds have a heavy influence on the oil prices. The price battle in the oil industry during the month of March was driven by the hedge fund giants. The hedge funds and other managers related to money have affected around 209 million barrels of oil pricing through WTI-linked futures.  Hedge funds reduced their shorts to 93 million from 116 million barrel during the seven-week period ranging from March to May. This points out sharp 55 percent decline. The U.S. Commodity Futures 
Trading Commission (CFTC) released data regarding the hedge funds transactions. During the similar time frame, hedge funds increased new longs merely by 2 percent (7 million barrels).  The net new longs were 381 million and now it is at 388 million. This pattern of the hedge fund exactly matches the time frame when the oil prices increased from $42 per barrel (lowest in March) to $62.50 per barrel (a highest on May 6).  The prices have increased by 50 percent almost. 
 Now the sharp growth period in crude oil is slowing down, therefore we have very options in the market to buy back.  The speculative buyers are largely wrong because they are paying high prices on the stock even when the prices are falling down.  The community responded exactly the opposite during June 2014 when WTI long position of 451 million barrels projected already high prices, but no one bought it.  The betting against the common market pattern and projecting price will reduce the mean by a small margin and that means chances of earning will increase with relatively low risk. 

 

atest Posts

Monsanto Restricts GMO Cotton Seed to India

Monsanto Restricts GMO Cotton Seed to India

Monsanto Co. recently withdrew an application that was seeking regulatory approval for cotton seeds to be sold in India. This took place in the middle of a debate with the government on the subject of royalty fees. According to the spokesperson of Monsanto Co., Christi Dixon, the application was…

More

Brexit vote: Finance ministers meet to discuss impact

Brexit vote: Finance ministers meet to discuss impact

An urgent meeting with Chancellor George Osborne has been called by UK finance ministers from the three devolved governments. This came after Finance Secretaries Derek Mackay from Scotland, Mairtin O Muilleoir from Northern Ireland, and Mark Drakeford from Wales met in Cardiff. The finance ministers…

More

ther posts

Wells Fargo fined for $70 million for mortgage malpractice

Wells Fargo fined for $70 million for mortgage malpractice

The U.S. Comptroller of the Currency fined Wells Fargo on Wednesday due to some malpractice in mortgage services. Between March 2013 and October 2014, according to the regulator, Wells Fargo made some escrow calculation errors. These errors, in some cases, led to incorrect denial modifications. The…

More

What you need to do before you quit your job

What you need to do before you quit your job

Quitting your job is a dream for many, especially if you’ve been unhappy there! In other cases, it may be as simple as moving on to greener pastures: a higher salary, a better position, or a company that is more compatible with your career and personality. Regardless of the scenario, ending…

More

ecents

Strong US Dollar cheers up the economy

Strong US Dollar cheers up the economy

United States labor market is literally booming and the drive of the growth is strong dollar. The Federal Reserve’s monetary policies are working right. The United States currency also cheered the stock markets. If the market continues to boom till September, the increase in the borrowing rate…

More

A Brief Theory on Experimental Finance

A Brief Theory on Experimental Finance

Experimental finance is an interesting branch in the study of finance. The main aim of this tactics is to understand not only the behavior of the market but also that of human behavior in settings that are simulated with relevance towards finance. This part of study is majorly researched based. The…

More

dvertisement

dvertisement