Commodity prices

Just when you think that Earth has gone pear-shaped from a financial point of view, you have Bill Evans from Westpac telling people that commodity prices will rise by 30% this year.  The last time when he was a contrarian regarding interest rates, all the other people thought he was bonkers.  He had the last laugh.  And apparently, this is not the first occasion.  So this time around, his opposing view regarding commodities has pricked the ears of fund managers.

While I may read financial news and do my own projection, I never fully act on it as logic demands.  That is because often, the opposite happens.  And because it has happened frequently, I work on a different strategy.  Most of the time, it is based on announcements on the ASX.  When everything is equal, if the share price plunge when a good news is announced, then logic demands a price rise.  So if there are idiots who want to sell, grab them!

This applied to BDR last week.  When I saw the share price fell, it was unbelievable.  So I put in a bid at a slightly lower price to fish out more idiots but I underestimated.  Idiots can be quite smart...  Because I didn't buy, when the prevailing market price at that moment was still below the price from the day before, I lost out at the end of the day when it started to climb way over to $1.045.  Some investors do not have visual or hearing loss, just that the information is very slow to get to the Buy part of their brains.  Anyway, I did pick up my latest parcel of BDR at 79.5c in mid-Sept after a good announcement and the market was indifferent.