Home Forums Members Forum Actual prices versus future prices Reply To: Actual prices versus future prices

Sean HymanSean Hyman
Post count: 3803

DBA is tracking what commodities are actually doing. The CRB Index tracks a basket of stocks in what they are presently doing. However, all financial assets look to the future, not the present. Institutions, for every asset, have to say where do I expect things to be 6-12 months from now and invest accordingly today, based off of that belief. Why? If you don’t do it that way, and you start entering by the time you think things are doing what you think they will do, you’ll find that the market has already factored it in and there is no value to be had. It’s already gone/past.

Commodities are no different. So, institutional investors are always investing today based off of their future outlook for an asset. This is what we do as well.