Commodities trader says don't follow the headlines

Jim McCormick, Allendale, Inc. senior trading advisor, on why it's important to look at the big picture when trading commodities like corn.

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Commodities Trader: Don’t Follow the Headlines

There’s a time and a place to look at the big picture – and also to get into the weeds.

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That’s the lesson from Allendale, Inc. senior trading advisor Jim McCormick. In a Conference Room interview with FBN’s Jeff Flock in a corn field in Illinois, McCormick says it’s important to do your own research and not get distracted by headlines.

“A lot of guys they call it trading out their back-door window. They look at one area, or the one little headline, and they get caught up in it,” says McCormick. “Right now a lot of guys are getting caught up in the flooding right now in Minnesota … But if you look right here in Northern Illinois, we have the potential of a record crop.”

And even on a field-by-field basis, McCormick says it’s essential to be thorough when evaluating the facts.

“You’re looking at probably 1% or 2% of the acreage is bad in this field, but most it looks incredible, plain and simple,” says McCormick.

Flock says there are takeaways for traders and business owners, too.

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“Look a little more granularly, and if you need to, dig down deep -- that’s where the real information is,” says Flock.

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