Price Asset Management

August 10, 2015

Barron's Article: "Time to Buy Commodities"

Barron’s is one of the few periodicals that has been willing to be contrarian enough to call a top or a bottom in an asset class (at least nearby). We concur with their conclusion.

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Relative Performance: The RICI® rebalances monthly which, on a long term basis, explains some of the potential for outperformance relative to benchmarks. However, rebalancing can be less helpful in the near term during short periods of time when a major commodity or sector declines without bouncing - as oil just did.  At the end of July the RICI®  added to its oil holdings, which had declined more than other sectors. Thus, early August performance was a bit more negative relative to other strategies that don’t frequently rebalance.  However, this sets up the RICI® to outperform when prices eventually recover, as we expect them to do given the history of mean reversion observed in commodities markets. We remain confident that taking advantage of this reversion to the mean across 37 commodities will continue to add value to long-term portfolios, consistent with the RICI®’s performance over the past 16 years.

Energy: In regard to energy and how low prices are the “cure’ for low prices; please see a quote from Phil Flynn’s 7/29/15 daily energy report, which is an excellent report you can subscribe to for added value commentary.

“While in the short term the world is focused on over supply the long term outlook becomes more interesting as big and little oil are making cuts that would make Jack the Ripper blush. As the Financial Times reported yesterday we have already seen the world's big energy groups cut $200 billion of spending on new oil projects. In other words the deferral of 46 big oil and gas projects with 20bn barrels of oil equivalent in reserves which is more than Mexico's entire proven energy reserves.”  

Phil Flynn The Energy report 7-28-15*
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Keep the faith: buy low and sell high!

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*The opinions expressed in The Energy Report are that of Phil Flynn's of The PRICE Futures Group and do not necessarily reflect those of Price Asset Management, LLC.

Commodities Mutual Fund Price Asset Management PCS Commodity Funds Price Holdings Inc.


This report does not constitute an offer to sell, or a solicitation of an offer to buy or sell, any commodities interests, managed futures accounts or securities, and is intended for informational purposes only. Any offer for any investment product will be made solely by the appropriate disclosure document or offering memorandum. Price Asset Management, LLC. does not make any representations as to the accuracy or completeness of any data or information contained herein and such information should not be relied upon as such. Some data and information presented in this report may have been obtained from outside sources. Price Asset Management Inc. makes no claims as to the accuracy or completeness of this information.

Investments in commodities, managed futures and other alternative investments involve a high degree of risk and performance can be volatile. An investor could lose all or a substantial amount of his or her investment. Investments in commodities, managed futures and other alternative investments are often executed on non-U.S. exchanges. Investing in foreign markets may entail risks that differ from those associated with investments in U.S. markets. Past performance is not indicative of futures results.

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