I'm reading an economics book, and in the rates analysis, the author says "If someone knew the future interest rates, they would be a very rich person." Of course I don't disagree with this statement, my question is: Say you knew the future interest rates up to say 5 years in the future with accuracy, what would you trade and how, to get the most out of it? Would it be foreign exchange trades? Or interest rate futures? Maybe options? I'd like to see what experienced traders would trade in this scenario.
Watch the movie The Taking of Pelham 123 (2009) and Hacker (2016) -- that will answer your question, It's options, that's how you will get the most out of anything, with future knowledge...of the future, The actual trading of the options is a very tiny portion of those films, but their accounts exploded exponentially after the event they caused happened, But like all Hollywood movies, things are greatly exaggerated. Options would greatly increase in value, but not as much as they did in those movies, A small NYC subway hijacking or the killing of the Fed Chairman won't make options increase in value by 10,000%+, or make the DOW general market drop by 25%.
It makes very little difference, to know the future you have to explore, but exploration is an expensive process which means that by the time you understand what will happen you will not have the capital to apply to the markets, and you will not be able to shorten the timeframes enough to leverage. You can very easily predict the markets, the problem is very few can keep their nerve to hold on during the noise. Futures are always interesting, options can work but in the reality of the world the timeframes can shift due to people coercing the markets, the longer the timeline the more influence can be exerted on the outcome. Given your question, the best is to deleverage everything in preparation, however if you time the trigger wrong it will make no difference if you are right long term, because the markets are designed to whipsaw you out.
Options on gold. Too much uncertainty in the world with no end in sight driven by a 95% crazy press (worldwide) with off-the-wall agendas.
Copper in my opinion has upside potential. With all the talk about electric motors in cars, that's a lot of copper in the motor windings. From what I can gather, lithium batteries also require some copper content. Automation/robots also require copper for the wirings.
Not much practical use. Direct participation in the markets will probably change the future as you know it, particularly if your funds are huge.
You need to qualify the statement. If both you and your trading counterparty know the future equally well, you will not make any money. You need to know the future better than the prevailing market consensus knows it. If you know the future interest rate on which exchange listed futures will settle and the futures price does not reflect this, obviously you should be trading these futures or options on them. By the way, the best way to know the future is to create it.
I agree that even if you could predict the future, you wouldn't necessarily become rich. On the other hand, we all know about the market cycles , although it's hard to wrap your head around them.
What would you trade if you knew the future You don't have to know the future - you simply need to anticipate which emerging products/services will appeal to people and find the leaders that are listed. For those that can envision & anticipate the next big thing they can strike it big provided they have enough capital, a lot of patience, a trading strategy, and some real guts.