Wednesday, 7 December 2011

Trading Update: the Precious Metals Strategy

Well since CU mentioned it, *ahem*, it is indeed a fact that the PM strategy has worked out OK.

As updated a while back, silver trading on a fairly active basis (by my sluggish standards) has yielded a tad over 40% - which is obviously sub-optimal but I failed to sell at the April peak. I've been flat since August, so there it stays. The issue with this book has been the grotesque VaR I was carrying whenever long. Boy, that's an ugly market: don't ever be away from your desk.

The gold is up just a tad over 30%, for zero activity and a very much lower (though by no means insignificant) VaR, depending on how you factor in the powerful multi-year (upward) drift. That's why the long stays on - and of course the valuation is MTM, with potential for an update by year-end.

Since all of this is considered (by me) a hedge against the other awful stuff away from the Drew trading-floor (e.g. the pension, for starters), I may end up needing every penny ... still, a few glasses to be raised when the C@W annual staff party convenes!

ND

3 comments:

Anonymous said...

ND: "The gold is up just a tad over 30% "

Yippey!! Toddles off to count sovereigns.

350% over six years at my best price.

250% over four years at my worst price.

Now, if only my mining stock would do as well.

Pity it is just a reflection of how shittily my sterling promissory note holdings have done.

Anonymous said...

All your PIIGS belong to us!

Laban said...

VaR ? Value at risk ?