Financial Services
Gradable Financial Services June Newsletter
With corn volatility easing and prices under pressure, producers may want to consider flexible pricing strategies that allow participation in rallies while managing downside risk.
With corn volatility easing and prices under pressure, producers may want to consider flexible pricing strategies that allow participation in rallies while managing downside risk.
CZ’26 Amplifier Plus: Price bushels at $4.95 every day CZ26 settles above $4.50
The Flow Report
As predicted in our last newsletter, the Ag complex was due for a reversion to normalcy in line with other asset classes. That has come to fruition as implied volatility (IV) has fallen over 5% in the past month and is now significantly under last year’s levels. While IV has much more room to fall – low teens are fairly common – it seems highly unlikely IV will completely collapse before we’ve gotten through the riskiest part of the growing season. We’d expect IV to find support here and potentially bounce if weather markets start to act up. Accordingly, we’d recommend growers take advantage of this combined selloff in prices and IV to buy back any short calls/double ups. Additionally, consider a pricing structure like the Amplifier which won’t knock out completely but simply skip pricing during price troughs.
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