In this issue we talk to Greg Firtik of Global Ag, LLC, a registered CTA, NFA ID #404932. To see the full performance sheet for the Global Ag, LLC, please go to Managed Futures Database by IBTRADE.
Name of Program
Global Ag, LLC- NFA ID #404932.
Name of Principals
Name of Principal with Trading Authority
Q: Can you give a brief description of your program? Do you accept notional funding?
The program is a discretionary model based on fundamental views. All trading decisions are made by David Skudder. Primarily corn, beans, and wheat. Notional funding will be considered for institutional clients.
Q: What is the average holding period for each trade?
The program is opportunistic and does not employ any day trading. Holding periods for any one position is mid to longer term.
Q: The program generates an astonishingly big number of AUM, what is your goal for it this year?
We are looking at capacity of $450 million. Our goal for 2012 is to be closed.
Q: The worldwide network of contacts and a wide range of market inputs associated in your program are very impressive. Are these the principal indicators directing the way you trade?
David's years of experience, industry contacts, meteorologists, and research are the sources for trading decisions.
Q: The program performed particularly well in the starting year of 2010 and even broke a single month's record of 26.39% in October. What factors contributed to this brilliant success?
David saw the moves very early in the cycle and traded accordingly. He is not content with simply a directional play but also look at inefficiencies between markets and months. This separates him from merely directional moves.
Q: We've noticed that the following year (2011) was an overall poorly performed year, which presented a negative figure there. Drawdowns frequently occurred in that year. Can you briefly describe why there was a comparatively large volatility at that time?
2011 was a directionless year. David saw this developing very early and held a conference in Memphis where he invited some of the smartest industry professionals. The conclusion from most was the same. Tough year to trade overall. Breaking even beat most of his peers. Those years happen.
Q: In what types of market environments does your trading program do well and /or struggle?
See #6. When markets have no direction and are up one day and down the next and the that trend continues over months. No one makes money. When you can see markets developing and events that causes shortages and demands David does a good job seeing where the market is going and can adjust quickly.
Q: How do you manage risk/reward and what metrics are employed?
As assets have grown David is much more conscience of drawdowns. He looks at positions daily and if he does not feel comfortable he will adjust. He does not want to fight out of a hole and as such attempts to not have double digit down months. He does not use a tremendous amount of margin so he does not believe in fighting a market.
Q: What's your opinion on current agricultural markets and how do you prepare against the volatility? Do you trade options within your program? If yes, please describe the types of options traded and how options risk is monitored.
Shortage in beans and everyone planting corn. David will use options to control risk and volatility. If he sees something is cheap he may buy it and if too expensive he may sell it. Also sometimes you like to have some options on in case a particular event occurs. This year everyone was planting early . We had some options on just in case we saw a freeze and crops got hurt. Cheap to buy at the time but let us sleep at night.
Q: What are your investment goals for this year (i.e. annual returns on performance)?
We are posting about a 14% return for April. Still look like opportunities persist as production numbers unravel. Weather may continue to be a factor in the US. No specific goal.
Q: What makes your program unique and outstanding among managers in your sector?
David Skudder makes our program unique. I do not feel many others have the insight or communication networks that compare. You have to have 15 conversations a day sometimes to pick up only item that important. When that item is mentioned you have to be able to know it and act accordingly.
David was a cash grain trader and learned his trade well. If you have a chance to visit our websites you will note very good returns from our other trades. Mark Ditsch was a cash soybean trader, Megan Bocken was a wheat analyst for year for a major research firm, and Dave Zelinksi of Opus has been providing the grain research reports for our group for years. We have a good team.
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