Peanut's Potent Plethora of Profit

[peanuts]

...Here's a link to the current GOLD:SILVER chart: LINK

Trade is turned off. The 150 week moving average of the ratio was met at 61.96... Total gain from the trade +11% in a few weeks. Not HUGE, but not too shabby

[peanuts]

Peanuts,
I like your approach and the way you are looking at their relationship to one another. pretty neat.

The best part about it is that it strips out the actual positive or negative price move of the commodity. The only thing that you are concerned with is the price relationship and having it meet a certain ratio value. I'm sure that it could be done with another commodity pairing that shows good historical data correlation... oil:gold, oil:gas, sugar:silver, or oil:wheat perhaps. As long as you can find a historical relationship and a current imbalance, you should be able to continue to make these trades in any kind of market. The influences of currency valuations is largely stripped out.

Here's a link to the current GOLD:SILVER chart: LINK

[skiracer]

Silver and Gold are both showing nice moves higher, but silver is outpacing gold. The ratio is down to 65.38 from 69.62, where I first offered the trade idea. The 150 week MA is now 61.51 which, if used as the trigger to turn off the trade, would yield a 11.65% return. Currently the gain on the position of short Gold, long Silver is 6.09%.



Let's assign a rounded date of when the precious metal bull market began at January 4, 2000:

price of gold: $282.05
price of silver: $5.3025
gold:silver price ratio: 53.19

If that ratio is met again, and you entered the trade at the ratio of 69.62, then you would have unrealized profit of 23.60%. But, the time for this to happen is most likely more than twice as long as the time it would take to reach 11.65% return.

Peanuts,
I like your approach and the way you are looking at their relationship to one another. pretty neat.

[peanuts]

Silver and Gold are both showing nice moves higher, but silver is outpacing gold. The ratio is down to 65.38 from 69.62, where I first offered the trade idea. The 150 week MA is now 61.51 which, if used as the trigger to turn off the trade, would yield a 11.65% return. Currently the gain on the position of short Gold, long Silver is 6.09%.



Let's assign a rounded date of when the precious metal bull market began at January 4, 2000:

price of gold: $282.05
price of silver: $5.3025
gold:silver price ratio: 53.19

If that ratio is met again, and you entered the trade at the ratio of 69.62, then you would have unrealized profit of 23.60%. But, the time for this to happen is most likely more than twice as long as the time it would take to reach 11.65% return.

[peanuts]

So far, so good:

[peanuts]

short GLD, long SLV

... the math shows approx. 28.57% potential return, regardless of the opportunity that you choose. Employing a moving average as the trigger for closing the trade would lessen the potential profit, but also add some accounting for the trend.

Theoretically, either trade can be made on futures contracts. Most do not have access to this trading. So, practically speaking this limits the trade to short GOLD, long SILVER. There is no ETF for COPPER. However, you can short GLD and buy SLV.

Here's a 3 year weekly candlestick chart that shows a 150 week moving average and a 7 week RSI. If you entered the trade today, and choose to use the 150 week MA as your trigger to turn off the trade, then the potential profit is approximately 11.82%

[skiracer]

There's a fella in Roanoke that is doing jail time right now because he "found" some of my copper wire on a construction site back in December....

the stuff i am talking about are short cufoffs left by the electrical contractor. nothing on the reel or roll. i think it was just scrap that no one wanted. anyway no one has mentioned it to me. it is still in my back yard scrap pile so i guess i could give it back if someone claimed it or came looking for it but if they do they better come with their holsters on.

[peanuts]

...I am also holding some GLD calls that are still in the red.

The current ratio of gold price to silver price is just under 70... which is historically very high

Those GLD calls ended up in the black and made up for the loss in AGQ.

Silver witnessed a rebound in comparison to the price of gold. The current ratio is more like 68.7:1 now. It still has further to go. I still like the short gold, long silver trade.

[riverbabe]

There's a fella in Roanoke that is doing jail time right now because he "found" some of my copper wire on a construction site back in December....

try scrap yards and railway tracks. hee

[Lyehopper]

wonder why I can't "find" any copper.....

My son-in-law, the artist, makes assemblage art from found objects. He has found a great deal of copper wire and sells it on ebay. Makes a bundle.

There's a fella in Roanoke that is doing jail time right now because he "found" some of my copper wire on a construction site back in December....

[Lyehopper]

..........................................

[peanuts]

i like both copper and silver peanuts. i just picked up a load of copper wire that was left on a job i was looking at. im not sure of the gauage but alot of 1/4" / 1/2" / and 1" service line copper. had to be at least 100 lbs. of it. i throw it in a pile out back. one of these days i'll get around to stripping it and getting rid of it when the prices goes back up. right now i think it's over $2.35 a lb. but it was up over $3.40 or so i think. the silver etf, SLV, looks good right here under $15.

I'm pretty sure there is a big difference in prices paid for stripped and unstripped wire at the scrap yards. Most of the scrap gets shipped to China.

I too like the depressed price of silver. I was pushed out of a trade in AGQ last week and I have been looking to re-enter. I am also holding some GLD calls that are still in the red.

The current ratio of gold price to silver price is just under 70... which is historically very high

[peanuts]

My son-in-law, the artist, makes assemblage art from found objects. He has found a great deal of copper wire and sells it on ebay. Makes a bundle. Teaches master classes. Could give you a link to his work, but hesitate to use this forum.

Peanuts, today read that First Energy is buying AYE.

http://www.marketwatch.com/story/fir...1?siteid=yhoof

yup... looks like I've got to send my bill payment to a new company. Also, I foresee further consolidation within the electricity generation and distribution industry

[riverbabe]

My son-in-law, the artist, makes assemblage art from found objects. He has found a great deal of copper wire and sells it on ebay. Makes a bundle. Teaches master classes. Could give you a link to his work, but hesitate to use this forum.

Peanuts, today read that First Energy is buying AYE.

http://www.marketwatch.com/story/firstenergy-buying-allegheny-energy-in-stock-deal-2010-02-11?siteid=yhoof

[skiracer]

i like both copper and silver peanuts. i just picked up a load of copper wire that was left on a job i was looking at. im not sure of the gauage but alot of 1/4" / 1/2" / and 1" service line copper. had to be at least 100 lbs. of it. i throw it in a pile out back. one of these days i'll get around to stripping it and getting rid of it when the prices goes back up. right now i think it's over $2.35 a lb. but it was up over $3.40 or so i think. the silver etf, SLV, looks good right here under $15.