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Market Advisors
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rhedge
Posted 6/3/2010 15:44 (#1223338 - in reply to #1223238)
Subject: Re: Market Advisors


I started focusing our farm on marketing about 20 years ago. I have used some low cost simple approaches such as Roach all the way to high cost complex people such as Gulke. The bottom line is it is up to you to learn it and make decisions for your business. Only you know what your comfort zone is, average yield, capacity for risk, storage, local basis, crop insurance coverage, margin $, etc. Only you can make the decisions. The market advisor business is half scheme and device. Most of these guys make decisions based on how they can cover thier tracks.

The other side of it is going to be taking someones advice and following it with a trade. I have never trusted the advisors that have thier own brokerage.

Go to the CME website and start looking around. Put together cost of production and calculate a margin. Figure out how to protect that margin with forward contracts and options. Learn about volitility, carry, and basis. It took me 10 years of frustration to learn what I know now but I have the ability to protect 100% of my crop before a seed goes in the ground. If you do not want to do that then you will always be at someones mercy. This will be the next great seperation in farming. Not who can produce more bushels but who can lock in profits year after year and take advantage of oportunities.


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