Opinions
John Hood
BMO Agriculture Commodities
ZCA-T
DON'T BUY
Apr 25, 2013
Stock price when the opinion was issued
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A play on soft foods (corn, wheat, beans, etc.) which he thinks will be counter cyclical to the broader markets. A lot of this is going to depend on how the spring crop fares. This is currently in support right now. If you are going into this, ease into it in order to see what happens with the crops in the spring. Support is around $11.80 so if it goes below that, just try to re-enter again. Ease into it.
There are several ways to participate in agriculture. You can use the futures market, which is what this does, or you can buy the stock related such as iShares (COW-T) or the US equivalent (MOO-T). The chart on this one shows a long downtrend and is mainly the soft commodities such as corn, beans, etc. The downtrend has been exasperated by excess moisture. It has recently had a nice correction period and it should rally from here.
They`ve all been getting beaten up. If you want to play that market then use this but there is greater volatility. Feed and seed companies. Not thrilled with the results.