Spread Trading

K

Klewtar

Well-Known Member
#51
#51
I'm interested in applying spread trading principles after reading the thread.

I've noticed that Lead and Zinc tend to move together at the same time.

When spreads are increasing, Lead and Zinc tend to increase in price (Lead more so than Zinc) and when spreads are decreasing, Lead and Zinc tend to decrease in price (Lead more so than Zinc.)

It'd be interesting to see whether Gold and Lead can be used for spread trading.
 
P

PitBull

Member
#53
#53
Klewtar said:
When spreads are increasing, Lead and Zinc tend to increase in price (Lead more so than Zinc) and when spreads are decreasing, Lead and Zinc tend to decrease in price (Lead more so than Zinc.)
Click to expand...
That sums up the Lead - Zinc spread trade perfectly.

Lead and Zinc are naturally found together and are usually extracted from the same sources. So their supply tends to have a natural correlation.

Unfortunately you don't see similar correlation between Gold and Lead.
 
Mietesh

Mietesh

New Member
#54
#54
Dear Members,

One Can Take Position of JULY Zinc-Lead Spread @ Spread Gap of 15.00 (showing on screen) With Target of 13.50 & SL Of 18.00.

As Of Spread is Not Risky Trading.....But Then Also If Someone Dont Want To Take Position With Big Lot Can Try With Two to Three Mini Lot.

Happy Spread Trading .

Join http://in.groups.yahoo.com/group/spreadtrend/ For Regular Spread Knowledge and Calls.
 
P

PitBull

Member
#55
#55
Date 29-Jul-11 29-Jul-11 Spread Gap
6-Jul-11 119.4 105.65 13.75
7-Jul-11 120.5 106.3 14.2
8-Jul-11 120.15 104.8 15.35
9-Jul-11 120.15 104.85 15.3
11-Jul-11 118.85 102.85 16
12-Jul-11 121.75 104.5 17.25

The spread gap has finally broken the 16 level. Currently I have no idea how much it will go to so I am staying out of this round. Older charts show levels of 24 reached a few years ago.
I will reenter once the gap starts decreasing.
 
R

Rajeevji

Active Member
#57
#57
sumeetsj said:
Whereas taking trades in Gold/Silver,
Calendar spreads proves much more profitable,
taking into consideration the moves and the volatility in Silver.

I have been successfully implementing calendar strategies in Gold and Silver and gaining consistently.
Click to expand...
Hello Sumeet,

Would you like to throwa little bit light on the method you use trade the gold silver spread. Yourself and Pitbull are the two persons who are more knowledgeable on spread trading.

regards

Rajeev:)
 
P

PitBull

Member
#59
#59
Date LEADMINI ZINCMINI Spread Gap
12-Jul-11 121.75 104.5 17.25
13-Jul-11 120.6 105.25 15.35
14-Jul-11 119 104.25 14.75
15-Jul-11 120.5 105.25 15.25
16-Jul-11 120.55 105.35 15.2
18-Jul-11 121.5 106.95 14.55
19-Jul-11 122.75 109.6 13.15
20-Jul-11 120.15 108.3 11.85


The spread value has dropped nicely from the peak of 17.25 to around 10 today.
My last trade was on the 14th morning (Short Lead - Long Zinc) at 14.75.
It should actually have been executed at 15 but one leg got closed and the other one did not at my buy rates.

I expect resistances at 10 and then at 8, so an opportunity may arise for the (Long Lead - Short Zinc) trade. But if Zinc crosses 110, I think we may see this gap fall even more.
 
Last edited:
Mietesh

Mietesh

New Member
#60
#60
OPPORTUNITY ALREADY THERE :-

Inter Commodity Spread Strategy :

Recommend to Buy Lead and Sell Zinc ( August Expy ) between Spread gap of 10.00 to 10.25. Todays S.G. Closing is 10.20. Keep Stoploss of 6.50 and 1st Trgt 11.25 & 2nd Trgt 12.00.

Happy Spread Trading.

Rgds.

For More Spread News & Strategy Join http://in.groups.yahoo.com/group/spreadtrend
 
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