Spread Edge SpreadEdge Capital 8265 Canal St. Frisco, TX 75034 ...€¦ · Newsletter Overview Executive Summary Darren Carlat is the Managing Director of SpreadEdge Capital, LLC

Spread Edge Capital, LLC

SpreadEdge Capital, LLC8265 Canal St. Frisco, TX 75034Darren Carlat (214) [email protected]

SpreadEdge CapitalNewsletter Overview

Executive SummaryDarren Carlat is the Managing Director of SpreadEdge Capital, LLC and is responsible for

all aspects of the company's operations including market research, trading, customer

satisfaction, and operations management. For over 30 years, Mr. Carlat has been

developing, programming, and testing a wide variety of trading systems.

In 2010, he finished initial development efforts on a seasonal spread trading strategy which he has continually refined,

enhanced and improved. This trading system has been used for his own trading activities including the SpreadEdge

Diversified Seasonal Spread Strategy (that is offered to the public) and is the basis for the SpreadEdge Weekly

Newsletter.

What is included in the SpreadEdge Weekly Newsletter?The SpreadEdge Weekly Newsletter contains a subset of actual trades from the

SpreadEdge Diversified Seasonal Spread program and a personal account for the CTA.

Details and results from this program are posted on the SpreadEdgeCapital.com

website. Specifically, the SpreadEdge Weekly Newsletter contains the following:

Weekly Spread Trade Watch ListEvery weekend SpreadEdge screens hundreds of possible spread trade combinations and provides a list of the 10-20

spread trades that have the best opportunity for profit. All trades executed and tracked in the Newsletter are chosen

from this list. These recommendations are perfect for subscribers that want to follow along or those that want to do use

the list as a starting point for their own research.

Charts and Commentary on Open TradesEvery weekend the charts from each commodity class are updated to show the market action from the previous week

and includes commentary of how the various trades in each class are progressing.

Email Alerts on Any ExceptionsTrades listed in the Watch List are color coded so that subscribers clearly understand the actions that will be taken during thenext trading week. ANY exceptions to the plan communicated in the Newsletter are emailed to all subscribers.

What Are the Primary Objectives of the NewsletterThe primary objective of the Newsletter is to provide an alternative to the managed

futures program to investors that prefer to execute the trades on their own. It is also to

provide examples of the types of trades that are placed in the SpreadEdge Seasonal

Spread program. Specifically, the main objectives of the SpreadEdge Weekly

Newsletter are as follows:

EducationThe mechanics of spread trading are clearly explained in each newsletter. In addition, the charts for one intra-commodity

and one inter-commodity spread are published in the Newsletter well before they are published on Inside Futures. These

charts, along with the explanation provided, give a visual explanation of the rationale for the trade.

TransparencyAll trade recommendations are posted in the Watch List in advance of actual trade execution and then followed throughout

the entire life of the trade.

AccountabilityResults of each trade (good, bad, or ugly!) are updated every week and tracked based off actual fill prices on both the entry

and exit. Detailed tracking of past closed trades and current open trades are updated each week in the newsletter. Also

note that all trades are placed in client and or personal accounts of the CTA. No hit and runs here! We are in it with you!

BEST OF ALL… FOR A LIMITED TIME THE NEWSLETTER IS FREE!!!!!

All your must do is send an email to [email protected] and request to be added to the email

distribution list.

mailto:[email protected]

SpreadEdge Capital, LLCWeekly NewsletterWeek Ending 11/15/19

SpreadEdge Capital, LLC

8265 Canal St. Frisco, TX 75034

Darren Carlat (214) 636-3133

[email protected]

www.SpreadEdgeCapital.com


Trading Journal11/15/19


The journey continues! Last week I introduced 3 portfolios that provide a framework to guide you through the various stages of your futures investing journey. This week I will expand (literally) and go deeper. Initially I thought providing 3 portfolios would provide an example on how you can progress as your tolerance, capital and experience grow. However, after thinking through this, I have decided to expand to 5 portfolios which covers all the bases. In the following paragraphs I will discuss how the portfolios were developed, how to trade any of the portfolios, and finally how to progress from one portfolio to another.

How the Portfolios Were DevelopedThe portfolios were developed using the quadrants shown below. The average profit of each trade based on the past 15 years is used to rank them and then to place into quadrants. Note that quadrants 1 though 3 are as close to ¼ of the population as possible and that Q4 is divided in half. The jump from Q3 to Q4a to Q4b are huge steps as the volatility of these last few groups are quite high. Note also that the portfolios are cumulative meaning Portfolio 2 includes everything from portfolio 1 plus additional trades that fall into the 2nd quadrant.

How to Trade a PortfolioThe most important element of the 5 portfolios is that they are not perfect and should not be traded without using your own good judgement and discernment. My focus when publishing recommendations is to attempt balance across the broader portfolio (which is portfolio 5). When you use the ranking system I have described, there is some natural balancing that occurs across portfolios 1-4. However, some commodities are naturally more volatile than others so there tends to be some bunching of commodities within a portfolio. So how to remedy this? Look at the watchlist at the beginning of each week and note the new recommendations and compare to your current holdings. If your already have exposure to a commodity that is recommended, it might be a good idea to pass. If you do not have exposure to a commodity that falls into the next higher group, it may be a good idea to open the trade. Use your own good judgement and remember that diversification is key.

How to Progress From One Portfolio to AnotherMoving from 1 portfolio to another probably seems intuitive but is more complex that you may think. If you have a few good months and your trading capital grows, jumping to the next level is appropriate. However, if you do this all at once your exposure will increase significantly and a bad week or 2 can take away your gains quickly. My advice… “go slow to go fast!”. Rather than jump to the next level all at once, start by placing some of the calendar trades at the next level and then later layer in the inter-com trades. Take slow half steps and grow your portfolio slowly. By doing this you will minimize the 3 steps forward, 2 steps back dance that is very natural with futures investing.

QuadrantCalendar

(Avg Profit)Inter-Commodity

(Avg Profit)

Q1 <$250 <$900

Q2 $250 - $400 $900- - $1,400

Q3 $400 - $600 $1,400 - $2,100

Q4a $600 - $900 $2,100 - $2,500

Q4b >$900 >$2,500

Portfolio

30% Margin Account

Size

10% Margin Account

SizeAvg Profit - Calendar

Avg Profit -Inter-

Commodity

#1 $10,000 $50,000 <$250 <$900

#2 $15,000 $70,000 <$400 <$1,400

#3 $30,000 $150,000 <$600 <$2,100

#4 $50,000 $200,000 <$900 <$2,500

#5 $70,000 $300,000 All All

Please note that I revised the Inter-Commodity column


Open and Closed Trade

Performance


Trade

#

Port-

fol io

#

Status Spread

Type

$ Avg

15 Yr

Profi t

Leg 1

(B / S)

Leg 1

Symbol

Leg 2

(B / S)

Leg 2

Symbol

Leg 3

(B / S)

Leg 3

Symbol

Enter

Date

Enter

Spread$

Exit

Date

Last

Spread$

Last

Equity$*

Best

Equity$*

Worst

Equity$*

65 2 Open Butterfly 504 Sel l 2 CLH20 Buy 4 CLM20 Sel l 2 CLU20 9-Aug (243) 14-Dec 160 403$ (1,000)$ 483$

86 4 Open Calendar 1,081 Buy 1 HOM20 Sel l 1 HOJ20 8-Sep (764) 17-Feb (832) (68)$ (823)$ 87$

90 4 Open Inter-Com 2,271 Buy 1 LHQ20 Sel l 1 LCQ20 27-Sep (7,699) 10-Dec (10,340) (2,641)$ (2,641)$ -$

100 3 Open Calendar 667 Buy 1 CLG20 Sel l 1 CLF20 29-Sep (432) 8-Dec (140) 292$ -$ 402$

101 4 Open Inter-Com 2,169 Buy 1 CK20 Sel l 1 WH20 30-Sep (5,514) 30-Jan (5,975) (461)$ (936)$ 1,013$

102 4 Open Calendar 1,256 Buy 1 LHQ20 Sel l 1 LHM20 2-Oct (809) 8-Mar (450) 359$ (270)$ 790$

108 2 Open Calendar 588 Buy 1 BCH20 Sel l 1 BCF20 9-Oct (783) 17-Nov (1,590) (807)$ (817)$ 90$

110 3 Open Inter-Com 1,588 Sel l 1 FCF20 Sel l 1 CH20 Buy 2 LCM20 14-Oct (70) 22-Nov 2,905 2,975$ (315)$ 3,337$

113 3 Open Inter-Com 1,886 Buy 1 SU20 Sel l 2 CH20 21-Oct 8,542 8-Dec 9,525 983$ (163)$ 1,650$

114 2 Open Calendar 457 Buy 1 LCJ20 Sel l 1 LCG20 22-Oct 691 10-Dec 440 (251)$ (340)$ 110$

118 1 Open Calendar 207 Buy 2 SMK20 Sel l 2 SMH20 27-Oct 722 20-Dec 540 (182)$ (202)$ 80$

121 2 Open Calendar 563 Buy 1 LCM20 Sel l 1 LCG20 28-Oct (2,469) 7-Dec (2,950) (481)$ (481)$ 60$

122 1 Open Inter-Com 706 Buy 1 SQ20 Sel l 1 BOV20 Sel l 1 SMV20 30-Oct (2,567) 18-Dec (2,981) (413)$ (542)$ 2$

123 1 Open Calendar 341 Buy 2 SN20 Sel l 2 SH20 2-Nov 2,197 3-Jan 2,175 (22)$ (25)$ 153$

126 5 Open Inter-Com 4,119 Buy 1 SU20 Sel l 1 WK20 4-Nov 22,324 20-Apr 22,063 (261)$ (911)$ 288$

127 2 Open Calendar 488 Buy 1 KWN20 Sel l 1 KWK20 6-Nov 409 25-Jan 375 (34)$ (96)$ -$

128 1 Open Calendar 193 Buy 2 NGG20 Sel l 2 NGF20 7-Nov (994) 20-Nov (1,100) (106)$ (106)$ 174$

129 1 Open Inter-Com 787 Buy 1 TYZ19 Sel l 1 EDU20 9-Nov (117,508) 28-Nov (117,022) 486$ (51)$ 677$

130 3 Open Calendar 609 Buy 1 CTH20 Sel l 1 CTK20 8-Nov (598) 24-Dec (590) 8$ (42)$ 8$

131 4 Open Calendar 1,030 Buy 1 SBV20 Sel l 1 SBK20 11-Nov 358 18-Apr 347 (11)$ (45)$ 22$

132 1 Open Calendar 196 Buy 2 CTH20 Sel l 2 CTN20 12-Nov (2,158) 18-Nov (2,150) 8$ (162)$ 8$

133 1 Open Inter-Com 235 Buy 1 FVZ19 Sel l 1 TUZ19 13-Nov (96,867) 28-Nov (96,669) 198$ -$ 245$

134 5 Open Inter-Com 2,559 Buy 1 PAH20 Sel l 1 PLF20 14-Nov 123,570 8-Dec 123,255 (315)$ (315)$ 2,240$

135 1 Open Calendar 183 Buy 2 SK20 Sel l 2 SH20 14-Nov 1,225 29-Dec 1,150 (75)$ (75)$ -$

136 2 Open Inter-Com 1,395 Buy 1 RBU20 Sel l 1 CLF20 16-Nov 14,442 2-Dec 14,162 (280)$ (280)$ -$

137 2 Open Inter-Com 1,177 Buy 1 CLV20 Sel l 1 HOM20 10-Nov (24,339) 8-Jan (24,662) (323)$ (323)$ 4$

* Al l equity va lues include actual fees and commiss ions to open each trade as wel l as accrued commiss ions and fees to close

Status Win # Loss # Trades Win % $/Trade $ / Win $ / Loss Equity$

Closed 66 45 111 59.5% 389 1,109 (668) 43,124$

Open 9 17 26 34.6% (39) 635 (396) (1,019)$

Total 75 62 137 54.7% 307 1,052 (593) 42,105$

Overview Trade Details Entry Exit / Last Equity


TRADING FUTURES INVOLVES SUBSTANTIAL RISK OF LOSS AND IS NOT SUITABLE FOR ALL INVESTORS. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. AN INVESTOR MUST READ AND UNDERSTAND THE CURRENT DISCLOSURE DOCUMENT BEFORE INVESTING. THERE ARE NO GUARANTEES OF PROFIT NO MATTER WHO IS MANAGING YOUR ACCOUNT

Open Trade Summary


Please note that commissions and fees are now included in the “Enter Spread$” column. This includes the actual fees from opening as well as the accrued fees to close. For details on the commissions and fees used, please consult the SpreadEdge Weekly Report Primer.

All trades are based on recommendations posted in advance on Inside Futures and/or in the Watch-List section of this newsletter. All trades are based on actual fill prices in the SpreadEdge Diversified Seasonal Spread program or a proprietary account of the CTA. Results from these trades may not represent the performance of this program. Actual results of the SpreadEdge Diversified program are posted on the SpreadEdgeCapital.com website.



Closed Trades


All trades are based on recommendations posted in advance on Inside Futures and/or in the Watch-List section of this newsletter. All trades are based on actual fill prices in the SpreadEdge Diversified Seasonal Spread program or a proprietary account of the CTA. Results from these trades may not represent the performance of this program. Actual results of the SpreadEdge Diversified program are posted on the SpreadEdgeCapital.com website.

Month Status Win # Loss # Trades Win % $/Trade $ / Win $ / Loss Equity$

Qtr 2 '19 Closed 20 16 36 55.6% 141 683 (535) 5,091$

Qtr 3 '19 Closed 35 25 60 58.3% 507 1,453 (817) 30,444$

Trade

#

Port-

fol io

#

Status Spread

Type

$ Avg

15 Yr

Profi t

Leg 1

(B / S)

Leg 1

Symbol

Leg 2

(B / S)

Leg 2

Symbol

Leg 3

(B / S)

Leg 3

Symbol

Enter

Date

Enter

Spread$

Exit

Date

Last

Spread$

Last

Equity$*

Best

Equity$*

Worst

Equity$*

103 1 Closed Inter-Com 627 Buy 1 SMZ19 Sel l 1 BOZ19 3-Oct 13,055 12-Oct 13,090 35$ (870)$ 100$

104 2 Closed Inter-Com 1,158 Buy 1 ECZ19 Sel l 1 BPZ19 3-Oct 60,635 11-Oct 60,331 (303)$ (381)$ 694$

105 3 Closed Inter-Com 1,990 Buy 1 ADZ19 Sel l 1 CDZ19 6-Oct (7,405) 28-Oct (7,710) (305)$ (690)$ -$

106 4 Closed Inter-Com 2,146 Buy 1 ADZ19 Sel l 1 ECZ19 8-Oct (70,324) 8-Nov (69,384) 940$ (1,076)$ 988$

107 1 Closed Inter-Com 847 Buy 1 LCG20 Sel l 1 FCK20 9-Oct (23,274) 29-Oct (23,058) 216$ (438)$ 340$

109 3 Closed Calendar 741 Buy 1 WN20 Sel l 1 WH20 11-Oct 499 7-Nov 413 (86)$ (200)$ 13$

111 1 Closed Calendar 392 Buy 1 RBJ20 Sel l 1 RBG20 15-Oct 7,729 31-Oct 7,372 (357)$ (365)$ -$

112 2 Closed Calendar 485 Buy 1 CTK20 Sel l 1 CTZ19 16-Oct 662 5-Nov 1,430 768$ (200)$ 780$

115 5 Closed Inter-Com 3,755 Buy 1 CLU20 Sel l 1 HOF20 26-Oct (28,850) 10-Dec (25,288) 3,561$ (3)$ 3,561$

116 2 Closed Inter-Com 1,232 Buy 1 BPZ19 Sel l 1 SFZ19 25-Oct (45,922) 10-Nov (45,613) 309$ (356)$ 362$

117 1 Closed Calendar 153 Buy 1 BCK20 Sel l 1 BCJ20 26-Oct (333) 13-Nov (310) 23$ (70)$ 23$

119 1 Closed Calendar 379 Buy 1 CTN20 Sel l 1 CTZ19 27-Oct 1,092 4-Nov 1,630 538$ -$ 550$

120 3 Closed Inter-Com 1,744 Buy 1 ADZ19 Sel l 1 JYZ19 28-Oct (46,977) 5-Nov (46,306) 670$ (85)$ 828$

124 1 Closed Inter-Com 862 Buy 1 CDZ19 Sel l 1 ECZ19 4-Nov (63,823) 11-Nov (62,475) 1,348$ -$ 1,348$

125 2 Closed Inter-Com 1,237 Buy 1 CLV20 Sel l 1 RBV20 4-Nov (11,932) 16-Nov (11,703) 230$ (156)$ 696$


Status Win # Loss # Trades Win % $/Trade $ / Win $ / Loss Equity$

Closed 66 45 111 59.5% 389 1,109 (668) 43,124$

Open 9 17 26 34.6% (39) 635 (396) (1,019)$

Total 75 62 137 54.7% 307 1,052 (593) 42,105$




Portfolio Break Down

With Estimated Margin Requirements

Please note that margin requirements are estimates only and can change day to day based on market conditions and other factors. Also note that no margin is tracked for closed trades because it is not important to your current portfolio risk profile. These portfolios are for illustrative purposes only. Every trader needs to determine their own personal strategy based on their risk tolerance, trading capital, and experience.

Status Trades

$ Profit /

Loss $ Margin Status Trades

$ Profit /

Loss $ Margin

Closed 41 1,770 Closed 71 14,751

Open 8 (105) 5,142 Open 15 (1,879) 10,787

TOTAL 49 1,664 TOTAL 86 12,872

Class Trades

$ Profit /

Loss

$ Avg

Profit Class Trades

$ Profit /

Loss

$ Avg

Profit

Currency 4 1,656 414 Currency 9 4,387 487

Energy 9 (78) (9) Energy 18 (428) (24)

Financial 5 2,952 590 Financial 8 8,306 1,038

Grain 14 (1,739) (124) Grain 23 (4,656) (202)

Meat 9 (1,990) (221) Meat 18 3,797 211

Metal 1 91 91 Metal 1 91 91

Soft 7 772 110 Soft 9 1,376 153

TOTAL 49 1,664 34 TOTAL 86 12,872 150

Status Trades

$ Profit /

Loss $ Margin Status Trades

$ Profit /

Loss $ Margin

Closed 91 21,839 Closed 104 24,569

Open 19 2,380 14,992 Open 24 (443) 19,723

TOTAL 110 24,219 TOTAL 128 24,126

Class Trades

$ Profit /

Loss

$ Avg

Profit Class Trades

$ Profit /

Loss

$ Avg

Profit

Currency 12 4,920 410 Currency 13 5,860 451

Energy 27 2,937 109 Energy 30 (850) (28)

Financial 9 11,596 1,288 Financial 9 11,596 1,288

Grain 28 (4,372) (156) Grain 34 (3,589) (106)

Meat 22 7,912 360 Meat 29 9,893 341

Metal 1 91 91 Metal 1 91 91

Soft 11 1,136 103 Soft 12 1,125 94

TOTAL 110 24,219 220 TOTAL 128 24,126 188

Status Trades

$ Profit /

Loss $ Margin Class Trades

$ Profit /

Loss

$ Avg

Profit

Closed 111 43,124 Currency 14 7,743 553

Open 26 (1,019) 34,555 Energy 31 2,711 87

TOTAL 137 42,105 Financial 9 11,596 1,288

Grain 37 (3,572) (97)

Meat 29 9,893 341

Metal 5 12,608 2,522

Soft 12 1,125 94

TOTAL 137 42,105 307

Portfolio 1 Portfolio 2

Portfolio 3 Portfolio 4

(Calendar = ALL, Inter-Com = ALL)

Portfolio 5

(Calendar =<2, Inter-Com =1) (Calendar =<3, Inter-Com =<2)

(Calendar =<4, Inter-Com =<3) (Calendar = ALL, Inter-Com =<4)


Open Trade Updates

• Energy - (Brent Crude, Crude Oil, Gas Oil,

Heating Oil, Natural Gas, RBOB Gasoline)

• Grains - (Corn, KC Wheat, Soybeans, Soy Meal,

Soy Oil, Wheat)

• Meats - (Feeder Cattle, Lean Hogs, Live Cattle)

• Softs – (Cocoa, Coffee, Cotton, Robusta Coffee,

Sugar, White Sugar)

• All Other – (Currency, Interest, Metals)



Watch-List Recommendations

Energy

Energy Trades (Brent Crude, Crude Oil, Gas Oil Heating Oil, Nat Gas, RBOB Gas)


Source: SeasonAlgo.com

Energy was mixed for the week but scratched out an overall gain of $90. The current open trades are down ($888). Our CLU20, HOF20 trade spiked early in the week enabling an early exit and profit taking. After a quick correction we re-entered by opening CLV20, HOM20. We are not normally this active with spreads, but this was 2 separate actions that worked out nicely together. We both rolled out the spread to a less volatile trade and extended the close out from 12/10 to 1/8.


Crude Oil (V20), Heating Oil (M20) SpreadCrude Oil (H20-2*M20+U20) Spread

Trade

#

Port-

fol io

#

Status Spread

Type

$ Avg

15 Yr

Profi t

Leg 1

(B / S)

Leg 1

Symbol

Leg 2

(B / S)

Leg 2

Symbol

Leg 3

(B / S)

Leg 3

Symbol

Enter

Date

Enter

Spread$

Exit

Date

Last

Spread$

Last

Equity$*

Best

Equity$*

Worst

Equity$*

65 2 Open Butterfly 504 Sel l 2 CLH20 Buy 4 CLM20 Sel l 2 CLU20 9-Aug (243) 14-Dec 160 403$ (1,000)$ 483$

86 4 Open Calendar 1,081 Buy 1 HOM20 Sel l 1 HOJ20 8-Sep (764) 17-Feb (832) (68)$ (823)$ 87$

100 3 Open Calendar 667 Buy 1 CLG20 Sel l 1 CLF20 29-Sep (432) 8-Dec (140) 292$ -$ 402$

108 2 Open Calendar 588 Buy 1 BCH20 Sel l 1 BCF20 9-Oct (783) 17-Nov (1,590) (807)$ (817)$ 90$

128 1 Open Calendar 193 Buy 2 NGG20 Sel l 2 NGF20 7-Nov (994) 20-Nov (1,100) (106)$ (106)$ 174$

136 2 Open Inter-Com 1,395 Buy 1 RBU20 Sel l 1 CLF20 16-Nov 14,442 2-Dec 14,162 (280)$ (280)$ -$

137 2 Open Inter-Com 1,177 Buy 1 CLV20 Sel l 1 HOM20 10-Nov (24,339) 8-Jan (24,662) (323)$ (323)$ 4$





Grain

Grains (Corn, KC Wheat, Soybeans, Soy Oil, Soy Meal, Wheat)



Our Grains were down ($508) for the week; our open trades are likewise down ($465). There is nothing good to report for this group as 7/8 holdings are now down. We never know where the “hot” class is going to be, so we stick with the strategy of spreading our exposure out as broadly as possible. This allows us to be in the markets that are hot while not being too exposed to the markets that are not.


2*Corn (H20) , Soybean (U20) SpreadSoybeans (H20-N20) Spread

Trade

#

Port-

fol io

#

Status Spread

Type

$ Avg

15 Yr

Profi t

Leg 1

(B / S)

Leg 1

Symbol

Leg 2

(B / S)

Leg 2

Symbol

Leg 3

(B / S)

Leg 3

Symbol

Enter

Date

Enter

Spread$

Exit

Date

Last

Spread$

Last

Equity$*

Best

Equity$*

Worst

Equity$*

101 4 Open Inter-Com 2,169 Buy 1 CK20 Sel l 1 WH20 30-Sep (5,514) 30-Jan (5,975) (461)$ (936)$ 1,013$

113 3 Open Inter-Com 1,886 Buy 1 SU20 Sel l 2 CH20 21-Oct 8,542 8-Dec 9,525 983$ (163)$ 1,650$

118 1 Open Calendar 207 Buy 2 SMK20 Sel l 2 SMH20 27-Oct 722 20-Dec 540 (182)$ (202)$ 80$

122 1 Open Inter-Com 706 Buy 1 SQ20 Sel l 1 BOV20 Sel l 1 SMV20 30-Oct (2,567) 18-Dec (2,981) (413)$ (542)$ 2$

123 1 Open Calendar 341 Buy 2 SN20 Sel l 2 SH20 2-Nov 2,197 3-Jan 2,175 (22)$ (25)$ 153$

126 5 Open Inter-Com 4,119 Buy 1 SU20 Sel l 1 WK20 4-Nov 22,324 20-Apr 22,063 (261)$ (911)$ 288$

127 2 Open Calendar 488 Buy 1 KWN20 Sel l 1 KWK20 6-Nov 409 25-Jan 375 (34)$ (96)$ -$

135 1 Open Calendar 183 Buy 2 SK20 Sel l 2 SH20 14-Nov 1,225 29-Dec 1,150 (75)$ (75)$ -$





Meat

Meat (Feeder Cattle, Lean Hogs, Live Cattle)


Meats continue to be somewhat mixed for the 3rd week in a row. This week we lost ($123) and open trades are now down ($41). Next week we will add a Feeder Cattle trade to round out the portfolio and are also looking to add to our Lean Hog positions.


Lean Hogs (M20-Q20) Spread


Feeder (F20), Corn (H20), Cattle (M20) Spread

Trade

#

Port-

fol io

#

Status Spread

Type

$ Avg

15 Yr

Profi t

Leg 1

(B / S)

Leg 1

Symbol

Leg 2

(B / S)

Leg 2

Symbol

Leg 3

(B / S)

Leg 3

Symbol

Enter

Date

Enter

Spread$

Exit

Date

Last

Spread$

Last

Equity$*

Best

Equity$*

Worst

Equity$*

90 4 Open Inter-Com 2,271 Buy 1 LHQ20 Sel l 1 LCQ20 27-Sep (7,699) 10-Dec (10,340) (2,641)$ (2,641)$ -$

102 4 Open Calendar 1,256 Buy 1 LHQ20 Sel l 1 LHM20 2-Oct (809) 8-Mar (450) 359$ (270)$ 790$

110 3 Open Inter-Com 1,588 Sel l 1 FCF20 Sel l 1 CH20 Buy 2 LCM20 14-Oct (70) 22-Nov 2,905 2,975$ (315)$ 3,337$

114 2 Open Calendar 457 Buy 1 LCJ20 Sel l 1 LCG20 22-Oct 691 10-Dec 440 (251)$ (340)$ 110$

121 2 Open Calendar 563 Buy 1 LCM20 Sel l 1 LCG20 28-Oct (2,469) 7-Dec (2,950) (481)$ (481)$ 60$





Softs

Softs (Cotton)



We added a Sugar and another Cotton trade to our portfolio but haven’t seen much movement in this group. For the week we gained a whopping $6 and the total for open trades in now up $5. Not much to report!

We have not identified any additional trades to add to this group next week.


Cotton (Z19-K20) Spread Sugar (K20-V20) Spread

Trade

#

Port-

fol io

#

Status Spread

Type

$ Avg

15 Yr

Profi t

Leg 1

(B / S)

Leg 1

Symbol

Leg 2

(B / S)

Leg 2

Symbol

Leg 3

(B / S)

Leg 3

Symbol

Enter

Date

Enter

Spread$

Exit

Date

Last

Spread$

Last

Equity$*

Best

Equity$*

Worst

Equity$*

130 3 Open Calendar 609 Buy 1 CTH20 Sel l 1 CTK20 8-Nov (598) 24-Dec (590) 8$ (42)$ 8$

131 4 Open Calendar 1,030 Buy 1 SBV20 Sel l 1 SBK20 11-Nov 358 18-Apr 347 (11)$ (45)$ 22$

132 1 Open Calendar 196 Buy 2 CTH20 Sel l 2 CTN20 12-Nov (2,158) 18-Nov (2,150) 8$ (162)$ 8$





Currencies, Interest, Metals

All Other (Currencies, Interest, Metals)



Most of our positive action has happened within this group. Currency has been hot in the past several weeks, but we closed all exposure earlier this week. We had an open Interest trade going into the week that we added to earlier this week. This group is working out so far and gained $736 for the week. We also opened a very volatile Platinum / Palladium trade late in the week and immediately saw why this is coded red and group 5 in the portfolio. This trade gained $2,240 on day 1 and then gave back ($2,555) the next day. Expect a bumpy ride if you are in this one!

We have identified a Currency trade to open next week. This is the only inter-commodity trade that we do not already have exposure to.


Ten Year (Z19), Euro $ (U20) Spread Platinum (F20), Palladium (H20) Spread

Trade

#

Port-

fol io

#

Status Spread

Type

$ Avg

15 Yr

Profi t

Leg 1

(B / S)

Leg 1

Symbol

Leg 2

(B / S)

Leg 2

Symbol

Leg 3

(B / S)

Leg 3

Symbol

Enter

Date

Enter

Spread$

Exit

Date

Last

Spread$

Last

Equity$*

Best

Equity$*

Worst

Equity$*

129 1 Open Inter-Com 787 Buy 1 TYZ19 Sel l 1 EDU20 9-Nov (117,508) 28-Nov (117,022) 486$ (51)$ 677$

133 1 Open Inter-Com 235 Buy 1 FVZ19 Sel l 1 TUZ19 13-Nov (96,867) 28-Nov (96,669) 198$ -$ 245$

134 5 Open Inter-Com 2,559 Buy 1 PAH20 Sel l 1 PLF20 14-Nov 123,570 8-Dec 123,255 (315)$ (315)$ 2,240$




New Trades Published Last

Week



Inside Futures Recommendations

Intra-Commodity


Watch List: Sugar (K20-V20) Calendar Spread

Our Soft portfolio is very thin so we will open a Sugar trade to get additional exposure. This trade has profited in 13 of the past 15 years when sold on 11/11 and bought on 4/18. The average profit to draw-down ratio is 86%, which is a bit lower than we generally like while, the average best profit is nearly 1.8 times the average worst profit.

Spread Details

Commodity Sugar

Spread Months May 20, Oct 20

Enter 11/11/19Buy – SBV20Sell – SBK20

Entry Price Limit ($0.36)

Exit 4/18/20Sell – SBK20Buy – SBV20

Stop Loss ($1,339)

15 Year Hypothetical Data

Win % 87%

Average Profit $1,030

Avg Drawdown ($1,197)

Average Best $1,295

Average Worst ($721)


Sugar (K20-V20)

This is the original post and has not been updated



Inter-Commodity


New Trade: Crude Oil (F20), Gasoline (U20) Inter-Commodity Spread

Spread Details

Commodity Crude Oil, Gasoline

Spread Months Feb 20, Sep 20

Enter 11/16/19Buy – RBU20Sell – CLF20

Entry Price Limit ($14,800)

Exit 12/2/19Buy – CLF20Sell – RBU20

Stop Loss ($1,814)


Win % 87%



Average Best $1,758



Crude Oil (F20), Gasoline (U20)

The short Crude Oil (F20), long RBOB Gasoline (U20) is well positioned to decline into seasonal weakness. This spread has historically profited in 13 of the past 15 years when sold on 11/16 and bought on 12/2. The average profit to draw-down ratio is strong at 133% while the average best profit is over 3.8 times the average worst profit. Friday, I will be selling the Crude Oil (F20) and buying the RBOB Gasoline (U20) inter-commodity spread at a limit of ($14,800).

This is the original post and has not been updated. Also, I noticed that this was not actually posted! Not sure what I did but regardless, we did enter the trade.


Watch-List for the Next Trading

Week



Watch List

Intra-Commodity

Below are spreads that have made the radar screen for next week. These trades are believed to provide the best opportunity out of the hundreds of spread combinations that were analyzed.

Each of these spreads are candidates for the SpreadEdge Seasonal Spread programs

Inter-commodity spreads are generally not included in the SpreadEdge Seasonal Spread programs but are being traded in a proprietary account.

To Buy a spread with 2 legs – Buy first symbol, Sell second symbolTo Sell a spread with 2 legs – Sell first symbol, Buy second symbolTo Buy a spread with 3 legs – Buy first symbol, Sell second, Buy third symbolTo Sell a spread with 3 legs - Sell first symbol, Buy second symbol, Sell third symbol


Inter-Commodity

Color CodingGreen – Candidates for the SpreadEdge program unless market action changes significantlyYellow – Candidates for SpreadEdge program if market action improves prior to entryBlue – Strong candidates for those that do not already have same or similar exposure

Commodity Name Side Legs Category Enter Exit Win%

Avg

Profit $

Avg

Draw

Down $

Best

Profit $

Worst

Loss $

Feeder Cattle FCH20-FCJ20 SELL 2 Meat 11/17/19 2/5/20 93% 488$ (564)$ 700$ (250)$

Cotton CTH20-CTK20 BUY 2 Food 11/20/19 12/17/19 100% 395$ (190)$ 493$ (56)$

Heating Oil HOF20-HOK20 SELL 2 Energy 11/21/19 12/7/19 93% 1,319$ (496)$ 1,455$ (157)$

Gas Oil GOF20-GOM20 SELL 2 Energy 11/21/19 12/11/19 93% 987$ (477)$ 1,153$ (257)$

Crude Oil CLM20-2*CLU20+CLZ20 SELL 3 Energy 11/21/19 4/13/20 93% 914$ (642)$ 1,193$ (229)$

Lean Hogs LHN20-LHQ20 SELL 2 Meat 11/21/19 4/15/20 100% 561$ (658)$ 893$ (245)$

KC Wheat KWK20-KWU20 SELL 2 Grain 11/22/19 4/1/20 93% 768$ (711)$ 889$ (491)$

Commodity Name Side Legs Category Enter Exit Win%

Avg

Profit $

Avg

Draw

Down $

Best

Profit $

Worst

Loss $

Beans, B Oil, B Meal SU20-BOV20-SMV20 SELL 3 Grain 11/17/19 12/31/19 93% 449 (539) 708 (174)

Corn, Soybeans 2*CH20-SU20 SELL 2 Grain 11/18/19 12/8/19 87% 928 (1,112) 1,513 (443)

Euro Dollar, 5-Yr EDM20-FVZ19 SELL 2 Interest 11/19/19 11/28/19 87% 307 (179) 387 (57)

Euro Dollar, 10-Yr EDU20-TYZ19 SELL 2 Interest 11/19/19 11/28/19 87% 545 (327) 709 (114)

5-Yr, 2-Yr FVZ19-TUZ19 BUY 2 Interest 11/19/19 11/28/19 100% 157 (123) 210 (34)

Crude Oil, Gasoline CLG20-RBU20 SELL 2 Energy 11/19/19 12/2/19 87% 1,071 (949) 1,438 (394)

Yen, Franc JYZ19-SFZ19 SELL 2 Currency 11/20/19 12/5/19 87% 1,216 (1,306) 1,849 (617)

Platinum, Palladium PLF20-PAH20 SELL 2 Metal 11/21/19 12/9/19 87% 2,747 (2,123) 3,542 (844)

Crude, Heating Oil CLU20-HON20 BUY 2 Energy 11/21/19 12/10/19 87% 1,114 (1,254) 1,578 (648)



Intra-Commodity


Watch List: Heating Oil (F20-V20) Calendar Spread

Spread Details

Commodity Heating Oil

Spread Months Feb 20, May 20

Enter 11/21/19Buy – HOK20Sell – HOF20

Entry Price Limit TBD

Exit 12/7/20Sell – HOF20Buy – HOK20

Stop Loss ($1,715)


Win % 93%


Avg Drawdown ($497)

Average Best $1,421



Heating Oil (F20-K20)

This week our best option, by far, is the Heating Oil (F20-K20) calendar spread. This spread is currently sitting on top channel formed by of the 5-yr and 15-yr patterns. This trade has profited in 14 of the past 15 years when sold on 11/21 and bought on 12/7. The average profit to draw-down ratio is very strong at 265% while the average best profit is almost 2.9 times the average worst profit.

The chart on this trade is based on the Thursday close.



Inter-Commodity


Watch List: Japanese Yen (Z19), Swiss Franc (Z19) Inter-Commodity Spread

Spread Details

Commodity Japanese Yen, Swiss Franc

Spread Months Dec 19

Enter 11/20/19Buy – SFZ19Sell – JPZ19

Entry Price Limit TBD

Exit 12/5/19Buy – JPZ19Sell – SFZ19

Stop Loss ($1,581)


Win % 87%



Average Best $2,016

Average Worst ($1,706)


Yen (Z19), Franc (Z19)

We have several great picks in the inter-commodity space, but we already have exposure to all but one in our portfolio. Currencies have been hot lately and the short Japanese Yen (Z19), Long Swiss Franc (Z19) looks to be well positioned to continue the string. This spread has profited in 13 of the last 15 years when sold on 11/20 and bought on 12/5. The average profit to draw-down ratio is 93% while the average best profit is 1.2 times the average worst loss.

The chart on this trade is based on the Thursday close.

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