Taking a try on long hogs here. Dafeeder what are you using to screen the options? I assume you're basing overpriced on implied vol?
Another way to look at the hogs is the seasonal tendency. The devil's in the details, but there is a seasonal in the July Lean Hog contract that suggests a short sale between the time period of April 25 and May 26, for an average profit of 2.75 cents/lb. in 13 out of the 15 previous years. The hogs made that move last Monday. Two days into the trade. Best equity amount in the last 15 years was about $2500.00, or 6.25 cents/lb. The hogs susequently made that move, too. Which is why I lean toward agree with the over-done theory, eventually, and think it's time to price out some calls. See www.tradehugger.com for more followup.
Common sense! The sky is falling mentality. This is no time to be short IMO and do you really believe that nobody knew this BS was coming out in th news? Oh I'm sure Seaboard didn't have a clue or any of the traders in the hog or Bellie pits. The sideways trade in the hogs and then dump pretty much got rid of a lot of weak hands and the Merc is good about doing that before a change in the market direction. I don't want to call the livestock pits crooked but sometime things look borderline. Sorry guys when there is a smoke there usually a fire. Also look at how the soybeans traded this year. Can you say fakeout breakout in the pork complex?:eek:
Looks like it was a well timed stab in the hogs, does any one think that the amount of hogs slaughtered as a result of H1N1 will effect supply at all?
Out most of that long hogs trade for about a nickel. Bet they go higher but the initial reaction is done.
======================= Well, gold4; swine are much like a garbage can anyway; so payday someday. Two DR s noted the real flu epidemic of 1918/+ ,started just a little in spring , slowed to nothing[seemed to expire] in summer; turned multimillion flu killer that fall/seasonal tendancys also. Called the spanish flu because only the spanish news papers wrote much about it, i think