The program has the following risks:
A) the risk of further falls in spreads. Excluding the 2008 financial crisis, spreads are currently at a low level, but the risk of a further fall in the spread cannot be ruled out. Pay close attention to the European debt crisis and its impact on us debt. Although there has been some relief in the short term, it is doubtful that the short-term panic may be eliminated in the short run. If the external economy deteriorates, we need to wait and see.
B) copper is much better than zinc, so there is a risk of a further fall in spreads. Although 2010 copper in excess supply of the state, but the excess capacity is relatively limited, and zinc supply is relatively abundant, this also leads to a long copper relatively large investors, which appears when the decline in copper zinc decline than a small decline, and fluctuations of zinc more. But for the current price structure, zinc after a substantial decline in the early period, short appeared a certain departure phenomenon.
4) coping with risk strategies
Use 20% of the reserve funds to respond to the above risks. We see that even price fell to -3000, the loss is 178 thousand, it will not appear the situation of ruin.
5) risk return ratio
The risk return ratio of the scheme is about 1:3 (the ratio of the maximum loss to the expected return).
6) warehouse and transfer strategy
At present, the aluminum and zinc price difference between the 1010 contracts is -817 (settlement price spread), the closing price difference -1110, so you can choose the appropriate timing in the 1010 contract Jiancang, the best price difference is lower than -1000 jiancang. At present, 1009 contract Jiancang opportunities more.
Zinc position is best to choose under the moving average, copper Jiancang best choose the top of the moving average.