ragz4u
02-22 09:55 AM
Bill Frist Website
http://frist.senate.gov/index.cfm?FuseAction=Columns.Detail&Column_id=82
AMERICA MUST NURTURE HOMEGROWN HIGH-TECHNOLOGY WORKFORCE
--Op/Ed in San Jose Mercury News--
Senator Frist listens as Dr. James Wingate, President of LeMoyne-Owen College in Tennessee, expresses support for the inclusion of the SMART Grant program in this week's Senate budget reconciliation bill, 11/2/05
February 2006 - Every time I visit Silicon Valley I'm reminded of a simple fact: American businesses lead the world because they employ talented people. From the top executives at companies like Apple and Cisco to the science and engineering students I'll speak with Monday at San Jose State University, Americans sit on the cutting edge of technology.
We have less than 5 percent of the world's population but produce almost a quarter of its wealth and enjoy the highest per capita income of any large industrial economy. Americans receive more patents than the citizens of any other country, have the world's best university system, do most of the world's basic research, and take home the lion's share of Nobel Prizes in the sciences.
As many people working in Northern California's technology sector have realized, however, we can't afford complacence. China and India together now produce at least twice as many engineers as the United States. Both have fast growing populations and high-quality universities. In search of profits, companies have begun to outsource more low- and medium-skilled jobs to these nations.
No amount of funding, furthermore, would allow the United States to catch -- much less exceed -- China and India's combined production of scientific personnel. We just don't have enough people. Even at our own universities, foreigners earn an ever-increasing percentage of degrees in the hard sciences. Some remain, but many end up taking their valuable skills back home. American companies, meanwhile, have thousands of scientific and engineering openings that they can't fill.
If we hope to remain the world's pre-eminent economic power,/ we need to produce more scientists and engineers and train them better. One recent study, indeed, found that 85 percent of income growth stems from technological change.
While every American deserves a high-quality education, we need to target additional resources on the most talented students to ensure America retains its competitive edge. In particular, we need to provide an incentive to all of America's bright, driven low-income students who want to pursue careers in the sciences. Right now, far too many talented students from poor backgrounds drop out of college or shift away from hard science because of the expense. It's bad for the country.
One program that the president signed into law earlier this year takes the first major step toward fixing the problem. The SMART Grant program, which I developed, will focus assistance on students in science, math and strategic foreign languages who earn B averages or better during their junior and senior years of college. Next year, the California State University system estimates, more than 3,000 students systemwide -- including many at San Jose State -- will benefit from the program. Many will have their tuition payments eliminated entirely and the numbers will rise in coming years as the program attracts more people into the sciences. Thousands more students in the University of California system will also benefit.
Of course, tuition subsidies alone can't ensure that we'll have enough talented workers. In the coming months, Congress will consider the president's proposals to improve K-12 math education, increase funding for basic research, support high-risk/high-reward applied science projects, and make the research and development tax credit permanent. Fiscal realities, of course, will play a role in any final decision as Congress examines these proposals.
Silicon Valley companies already do an excellent job recruiting America's best and brightest. Now the government needs to build on its efforts to increase the ranks of homegrown scientists and engineers.
Hey Sobers,
Great work....I always look forward to your postings. Positive energy like yours helps IV in more ways than one.
Keep it up
http://frist.senate.gov/index.cfm?FuseAction=Columns.Detail&Column_id=82
AMERICA MUST NURTURE HOMEGROWN HIGH-TECHNOLOGY WORKFORCE
--Op/Ed in San Jose Mercury News--
Senator Frist listens as Dr. James Wingate, President of LeMoyne-Owen College in Tennessee, expresses support for the inclusion of the SMART Grant program in this week's Senate budget reconciliation bill, 11/2/05
February 2006 - Every time I visit Silicon Valley I'm reminded of a simple fact: American businesses lead the world because they employ talented people. From the top executives at companies like Apple and Cisco to the science and engineering students I'll speak with Monday at San Jose State University, Americans sit on the cutting edge of technology.
We have less than 5 percent of the world's population but produce almost a quarter of its wealth and enjoy the highest per capita income of any large industrial economy. Americans receive more patents than the citizens of any other country, have the world's best university system, do most of the world's basic research, and take home the lion's share of Nobel Prizes in the sciences.
As many people working in Northern California's technology sector have realized, however, we can't afford complacence. China and India together now produce at least twice as many engineers as the United States. Both have fast growing populations and high-quality universities. In search of profits, companies have begun to outsource more low- and medium-skilled jobs to these nations.
No amount of funding, furthermore, would allow the United States to catch -- much less exceed -- China and India's combined production of scientific personnel. We just don't have enough people. Even at our own universities, foreigners earn an ever-increasing percentage of degrees in the hard sciences. Some remain, but many end up taking their valuable skills back home. American companies, meanwhile, have thousands of scientific and engineering openings that they can't fill.
If we hope to remain the world's pre-eminent economic power,/ we need to produce more scientists and engineers and train them better. One recent study, indeed, found that 85 percent of income growth stems from technological change.
While every American deserves a high-quality education, we need to target additional resources on the most talented students to ensure America retains its competitive edge. In particular, we need to provide an incentive to all of America's bright, driven low-income students who want to pursue careers in the sciences. Right now, far too many talented students from poor backgrounds drop out of college or shift away from hard science because of the expense. It's bad for the country.
One program that the president signed into law earlier this year takes the first major step toward fixing the problem. The SMART Grant program, which I developed, will focus assistance on students in science, math and strategic foreign languages who earn B averages or better during their junior and senior years of college. Next year, the California State University system estimates, more than 3,000 students systemwide -- including many at San Jose State -- will benefit from the program. Many will have their tuition payments eliminated entirely and the numbers will rise in coming years as the program attracts more people into the sciences. Thousands more students in the University of California system will also benefit.
Of course, tuition subsidies alone can't ensure that we'll have enough talented workers. In the coming months, Congress will consider the president's proposals to improve K-12 math education, increase funding for basic research, support high-risk/high-reward applied science projects, and make the research and development tax credit permanent. Fiscal realities, of course, will play a role in any final decision as Congress examines these proposals.
Silicon Valley companies already do an excellent job recruiting America's best and brightest. Now the government needs to build on its efforts to increase the ranks of homegrown scientists and engineers.
Hey Sobers,
Great work....I always look forward to your postings. Positive energy like yours helps IV in more ways than one.
Keep it up
wallpaper Rose flower in black and white
masouds
09-17 02:31 PM
Why did Ms. Lofgren ask for a roll call of Nays? Wouldn't that be more wasteful of the time?
(nm. It was close)
(nm. It was close)
Maverick1
11-11 10:08 PM
I have checked with my company's lawyer and he said I can maintain H1 status with my current employer and use EAD for part time job. I read murthy chat transcripts and same topic was discussed with two different answers. ................
I work for a very big company ........................I do not want to be limited by work authorization limitations...
Thats my oppinion...
Using H1B makes one safe. but how many years we want to do the safe job. If I-485 gets denied do u have enough patiences to file another green card. One thing is believe is "We are here to make money, most of us are in our thirties and we have short time remaining to reach our goals. I think we all have one year EAD. wait for 6 months then go on job hopping, learn whatever you can, get into whatever you want. Start a business, do something.... Anything you do will help you in future. Sitting with H1B in pocket may take 4 years cream of your life.
If you have the talent you can get great salaries anywhere in the world. Because of your talents and hard work you guys are here. World is not small.
I-485 is mostly about the eligibility of the individual (like medical, illegal presence, fraud etc.) and so getting rejected at I-485 stage is not that common (especially after the approval of the underlying immigration petition). And if it does get rejected, more often than not, the individual may never be eligible for permanent residence due to the same reason. So usefulness of H1-B as back-up is of very limited narure.
Thanks every one for all your responses. Good to see many responses which seem to echo what I was thinking. After reading many posts on these forums I thought many people chose to keep H1 (some times at a cost).
Now I see many people are ready to dump it if they see an opportunity to use EAD. That is good to know.
Although we cite the cost savings (from renewal of EAD) most people if not all who prefer to keep H1 status will definitely renew their EAD/AP just to be safe. On the AP case, I got 3 copies of multiple entry APs. My attorney told me to make copies of it and give only copies at the POE and point out that it is a multiple entry document if the officer wants to keep the original, so that the original stays with you.
I guess many people want to put the EAD to productive use. Some thing to supplement your main job/income.
I work for a very big company ........................I do not want to be limited by work authorization limitations...
Thats my oppinion...
Using H1B makes one safe. but how many years we want to do the safe job. If I-485 gets denied do u have enough patiences to file another green card. One thing is believe is "We are here to make money, most of us are in our thirties and we have short time remaining to reach our goals. I think we all have one year EAD. wait for 6 months then go on job hopping, learn whatever you can, get into whatever you want. Start a business, do something.... Anything you do will help you in future. Sitting with H1B in pocket may take 4 years cream of your life.
If you have the talent you can get great salaries anywhere in the world. Because of your talents and hard work you guys are here. World is not small.
I-485 is mostly about the eligibility of the individual (like medical, illegal presence, fraud etc.) and so getting rejected at I-485 stage is not that common (especially after the approval of the underlying immigration petition). And if it does get rejected, more often than not, the individual may never be eligible for permanent residence due to the same reason. So usefulness of H1-B as back-up is of very limited narure.
Thanks every one for all your responses. Good to see many responses which seem to echo what I was thinking. After reading many posts on these forums I thought many people chose to keep H1 (some times at a cost).
Now I see many people are ready to dump it if they see an opportunity to use EAD. That is good to know.
Although we cite the cost savings (from renewal of EAD) most people if not all who prefer to keep H1 status will definitely renew their EAD/AP just to be safe. On the AP case, I got 3 copies of multiple entry APs. My attorney told me to make copies of it and give only copies at the POE and point out that it is a multiple entry document if the officer wants to keep the original, so that the original stays with you.
I guess many people want to put the EAD to productive use. Some thing to supplement your main job/income.
2011 roses, white roses etc.
miceelf88
01-08 03:25 PM
Bartely any movement for ROW either. How does the visa bulletin move to the state projected in the Jan bulletin.
Does anyone know whether State's fiscal year ends in June or September?
Does anyone know whether State's fiscal year ends in June or September?
more...
panky72
06-11 01:31 PM
I had called the congressman from my district (Peter Visclosky) along with the other representatives on the list a few weeks ago. His office had taken my name and address at that time. Today I was surprised to see a letter in mail regarding that conversation and his intention to support the immigration bills in house. So it looks like that the messages we leave with congressional staffers who attend the phones do pass on the message to congressmen.
rangaswamy
08-26 02:30 PM
Since this discussion has been going on for 5 pages, i thought ill add my 2c.
Firstoff i haven't gone through all 5 pages so if someone already mentioned this, please don't jump on me. You can create an SBI account called SWIFT account. They will give you an account number and a SWIFT code for the bank.
You can then initiate a wire transfer from any bank in the US. They charge a flat rate of around 35-45$. The good part is, you can have the money sent in $ to your local account. They say it takes 3 days but it never takes more than one day for me.
The money is saved in FD as dollars and earns you interest if you leave it for 11 months. If you need to convert it any time, you have to forgo the interest (as with any FD) and you can get the closing exchange rate of the previous day.
This has many advantages
1) one simple fee of 35$
2) In case you want to bring back the money to the us, since it is kept as dollars, you can transfer it back without any hassle. (To keep it in dollars , you may have to provide this as a special instruction)
3) Folks back home have control on exchange rate, they can cash it any time it is high
4) Takes less than a day in most cases.
If you do the math, you will see that this is better than icici when you are sending 4000$ or more approx. icici does not take fees upfront but they always give you almost 50p less than exchange rate.
I have used this 4 times so far and its very reliable.
Thanks.
Firstoff i haven't gone through all 5 pages so if someone already mentioned this, please don't jump on me. You can create an SBI account called SWIFT account. They will give you an account number and a SWIFT code for the bank.
You can then initiate a wire transfer from any bank in the US. They charge a flat rate of around 35-45$. The good part is, you can have the money sent in $ to your local account. They say it takes 3 days but it never takes more than one day for me.
The money is saved in FD as dollars and earns you interest if you leave it for 11 months. If you need to convert it any time, you have to forgo the interest (as with any FD) and you can get the closing exchange rate of the previous day.
This has many advantages
1) one simple fee of 35$
2) In case you want to bring back the money to the us, since it is kept as dollars, you can transfer it back without any hassle. (To keep it in dollars , you may have to provide this as a special instruction)
3) Folks back home have control on exchange rate, they can cash it any time it is high
4) Takes less than a day in most cases.
If you do the math, you will see that this is better than icici when you are sending 4000$ or more approx. icici does not take fees upfront but they always give you almost 50p less than exchange rate.
I have used this 4 times so far and its very reliable.
Thanks.
more...
permfiling
12-13 11:43 AM
As there are now many people who are actively posting in the group. Identify and rotate the maintenance of the membership among these members on a weekly basis.
The ideas are good and in the past we have contemplated having a paid member area on IV site too. However the biggest problem we have is - who will manage it?
We all have full time jobs and already have our hands full. Adding anything extra to the current workload will be too much work for us.
Either we hire someone to do it. And to hire we need money. We find it hard to even raise money for Lobbying every other month. There are other important areas like publicity we can look at too if we get more funds. So we cannot hire anyone to manage this.
Now can someone volunteer for it? Yes but how many people come forward with a commitment in a 25k membership? You can see from the thread
http://immigrationvoice.org/forum/showthread.php?t=15289
So if people are not willing to make a commitment and have their spouses to help us from home for this cause, we cannot take our ideas any further. We can only do what our limited time, funds and manpower allows.
This is a reality and is the reason why we all do not have greencards till now. Solving this greencard issue is not difficult. Its only a matter of gathering enough people and people wanting to make an effort. IV has been around for 2 years now and only 25K people have signed up. We should have had about half million signups by now and millions of dollars to spend on large scale lobbying, media publicity and several initiatives to draw the attention of lawmakers on this issue. That has not yet happened and will not happen until we all indicate how badly we want greencards.
The ideas are good and in the past we have contemplated having a paid member area on IV site too. However the biggest problem we have is - who will manage it?
We all have full time jobs and already have our hands full. Adding anything extra to the current workload will be too much work for us.
Either we hire someone to do it. And to hire we need money. We find it hard to even raise money for Lobbying every other month. There are other important areas like publicity we can look at too if we get more funds. So we cannot hire anyone to manage this.
Now can someone volunteer for it? Yes but how many people come forward with a commitment in a 25k membership? You can see from the thread
http://immigrationvoice.org/forum/showthread.php?t=15289
So if people are not willing to make a commitment and have their spouses to help us from home for this cause, we cannot take our ideas any further. We can only do what our limited time, funds and manpower allows.
This is a reality and is the reason why we all do not have greencards till now. Solving this greencard issue is not difficult. Its only a matter of gathering enough people and people wanting to make an effort. IV has been around for 2 years now and only 25K people have signed up. We should have had about half million signups by now and millions of dollars to spend on large scale lobbying, media publicity and several initiatives to draw the attention of lawmakers on this issue. That has not yet happened and will not happen until we all indicate how badly we want greencards.
2010 Rose Flowers,
ashishgour
09-17 11:37 AM
Guess they are reaching a bi-partisan consent about giving discretion to judges...hopefully this gets done soon..we shud be up next..
more...
chanduv23
06-03 12:13 PM
Congratulations, and that is probably the most 'relieving' MTR approval message ever.
Thank you for sharing your story.
Definitely - some "comforting words after the person went through so much stress" looks like the officer knows what exactly to write :)
It is like a cardiologist saying "I can fix any kind of heart except a broken heart" :) :) :)
Thank you for sharing your story.
Definitely - some "comforting words after the person went through so much stress" looks like the officer knows what exactly to write :)
It is like a cardiologist saying "I can fix any kind of heart except a broken heart" :) :) :)
hair Elegant Wedding Flowers White
GCwaitforever
06-08 01:42 PM
The US constitution guarantees the basic rights enshrined within it to all within its borders irrespective of nationality or immigration status. The claim that the undocumented do not have rights is one propagated by Lou Dobbs and other anti-immigrationists. This is why it is possible for an undocumented worker to file a discrimination complaint with the EEOC and win for example.
You have to see my quote from the context of immigration. I never said illegal immigrants do not have any rights. Human rights are across the board. Every nation must follow these standards. Illegal immigrants can not sneak into a country and then demand that they should be given citizenship.
Regarding undocumented workers filing with EEOC, please quote me few cases like that. I doubt if it is ever possible. In my personal opinion, when such workers are subject to deportation when found, where is the foundation in that case? Are you suggesting that non-citizens can apply for jobs in defence and aviation and complain to EEOC if rejected?
I read few articles about (undocumented) women being exploited by the employers and USCIS/DOL treated these women as victims. That angle was more of human trafficking, not employee-employer relations.
You have to see my quote from the context of immigration. I never said illegal immigrants do not have any rights. Human rights are across the board. Every nation must follow these standards. Illegal immigrants can not sneak into a country and then demand that they should be given citizenship.
Regarding undocumented workers filing with EEOC, please quote me few cases like that. I doubt if it is ever possible. In my personal opinion, when such workers are subject to deportation when found, where is the foundation in that case? Are you suggesting that non-citizens can apply for jobs in defence and aviation and complain to EEOC if rejected?
I read few articles about (undocumented) women being exploited by the employers and USCIS/DOL treated these women as victims. That angle was more of human trafficking, not employee-employer relations.
more...
gcbikari
06-18 11:08 AM
Where can I find medical insurance for my parents with reasonable coverage with reasonable premium. Their age is between 55 to 60. Obviously they are with some medical conditions like blood pressure, diabetic... like usual stuff like typical parents would have...Can somebody suggest good one... thanks in advance.
I have used AIG for my in-laws visit and didn't had to use it. Why can't we add them to our insurance as dependants? Did anyone tried this?
I have used AIG for my in-laws visit and didn't had to use it. Why can't we add them to our insurance as dependants? Did anyone tried this?
hot quot;The white Rose flower.
bhatt
03-14 08:31 AM
http://travel.state.gov/visa/frvi/bulletin/bulletin_4177.html
I get 404 error when clicked on the above url. Did they remove it ? is it again the same July 2007 fiasco ?
Try now, it is back !
I get 404 error when clicked on the above url. Did they remove it ? is it again the same July 2007 fiasco ?
Try now, it is back !
more...
house The FTDamp;reg; White Rose Flower
msp1976
02-11 12:39 PM
There is some massive confusion here. The Immigration and Nationality Act also says the following for EB3
-Quote
(3) Skilled workers, professionals, and other workers
(A) In general
Visas shall be made available, in a number not to exceed 28.6 percent of such worldwide level, plus any visas not required for the classes specified in paragraphs (1) and (2), to the following classes of aliens who are not described in paragraph (2):
-End Quote
Read the term "Not to exceed 28.6 percent". So EB3 can't exceed 28.6 percent which means unused visas from EB2 cant all go to EB3. Since EB2 ROW is current, the unused EB2 visas should be coming to EB2 India & china as per AC21 law.. no?
We shouldn't assume that USCIS is too dumb to follow the law..
Read the term "Not to exceed 28.6 percent plus"That plus means EB3 total can exceed 28.6%..
No.... USCIS is not dumb...They have interpreted the law in the way they think is appropriate....They are applying the over all 7% country cap to China/India EB2 and sending the overflow to EB3 ROW..... It is not fair but it is not exactly illegal...The law is open to interpretation and USCIS has chose to select this interpretation......You can take a crack at suing the USCIS.....I doubt that you would get anywhere......The EB2 India/China might benefit from the lawsuit....But as you know not all members would agree on IV spending resources on this lawsuit because this serves only a small section of member population.... At a personal level you can gather a few EB2 China India guys and have a crack at suing USCIS....
-Quote
(3) Skilled workers, professionals, and other workers
(A) In general
Visas shall be made available, in a number not to exceed 28.6 percent of such worldwide level, plus any visas not required for the classes specified in paragraphs (1) and (2), to the following classes of aliens who are not described in paragraph (2):
-End Quote
Read the term "Not to exceed 28.6 percent". So EB3 can't exceed 28.6 percent which means unused visas from EB2 cant all go to EB3. Since EB2 ROW is current, the unused EB2 visas should be coming to EB2 India & china as per AC21 law.. no?
We shouldn't assume that USCIS is too dumb to follow the law..
Read the term "Not to exceed 28.6 percent plus"That plus means EB3 total can exceed 28.6%..
No.... USCIS is not dumb...They have interpreted the law in the way they think is appropriate....They are applying the over all 7% country cap to China/India EB2 and sending the overflow to EB3 ROW..... It is not fair but it is not exactly illegal...The law is open to interpretation and USCIS has chose to select this interpretation......You can take a crack at suing the USCIS.....I doubt that you would get anywhere......The EB2 India/China might benefit from the lawsuit....But as you know not all members would agree on IV spending resources on this lawsuit because this serves only a small section of member population.... At a personal level you can gather a few EB2 China India guys and have a crack at suing USCIS....
tattoo white rose 31
wait4ever
10-30 07:38 AM
What is this reverse brain drain ? there is no such thing - folks who are here are going to hang on tooth & nail to stay here come hell or high water - the only ones who are going back are the ones who have no other option.
more...
pictures Cream white rose flower close
ujjvalkoul
05-24 02:02 PM
I am sure each one of us has enough resources to settle anywher ein the world....it is just more work, shifting etc etc....
Whoa re willing to take that initiative....let show them waht mettle we are made of - these selfish politicians...and Corporate america
Whoa re willing to take that initiative....let show them waht mettle we are made of - these selfish politicians...and Corporate america
dresses prosperity white rose
whitecollarslave
01-31 12:08 AM
Of the top 22 most popular questions -
1 about Katrina
1 about Darfur
1 about EB immigration
19 about NASA
1 about Katrina
1 about Darfur
1 about EB immigration
19 about NASA
more...
makeup Hot Beige amp; White Rose
panky72
08-22 01:48 PM
Finally I am a US citizen after being 10+ years in this country. This is one of my biggest fulfillments and it means everything to me. US is just not home anymore for me, it is my country.
I wish everyone the best and hope they get GC very soon.
Proud to be an indian-american and legal immigrant.
Good Luck!
Congratulations. I think its a positive thing that people still come to IV to contribute and help to fix the broken immigration system even after they get their GC and citizenship.
I wish everyone the best and hope they get GC very soon.
Proud to be an indian-american and legal immigrant.
Good Luck!
Congratulations. I think its a positive thing that people still come to IV to contribute and help to fix the broken immigration system even after they get their GC and citizenship.
girlfriend Old Fashioned White Rose. Old
go_guy123
02-02 01:50 PM
excpet for Directors and above.
They don't pay taxes, etc etc. It is being mis-utilized by all companies.
IBM brings people on L1 @ 60K
They don't pay taxes, etc etc. It is being mis-utilized by all companies.
IBM brings people on L1 @ 60K
hairstyles white flowers, white rose
Eternal_Hope
01-30 07:44 PM
Q # 60 & 78
6:58 p.m. CST.
6:58 p.m. CST.
smisachu
01-23 08:57 PM
good thread. I do little bit of trading myself from a personal brokerage account and made some pocket change (few hundreds by trading commodity ETFs) recently. in layman terms, can u explain wht do u mean by ' US natural gas market is in contango' .
First of all note that the original post was alomst year and a half old so dont go by the ideas there now :D
In commodity markets you trade futures and spot. Spot means immidate delivery of the under lying commodity. In futures you pay today for delivery at a future date. So typically the price of the future will be the price of spot + the storage charge (simple calculation to give you an idea considering no premiums). As the day of delivery approaches the price will pull to spot price. For example if west texas intermediate (WTI) crude is $92 spot price the 3 month future will be $100. (92+8 for storage). Considering that the spot price does not change at all, in three months time the price of the oil you will now be purchasing will be $92, but you paid $100 for it. This is backwardation. This is usually how markets are most of the time.
Now if in 3 months the price of WTI is trading at $110, you will own oil you paid $100 for and now can turn around and sell for $110. This is contango.
When you buy a commodity ETF, they dont take actual delivery of the product, they roll their contarcts. So they will hold a 3 month contarct and when the third month approaches they sell the contarct and get another 3 month contaract. If market is in backwardation then they will always be buying high and selling low. If market is in contango they will make money but as soon as it switches back to backwardation they will ride down the slide and loose all the money they made. So I dont think ETF's are agood way of making money in commodities passively. You can actively manage the ETF portfolio and make money using options and hedges and leveraged ETF's. But buy and hold, I suggest go and invest with a CTA who will be trading rule based to negate the effects of contango and backwardation.
Hope this is simple enough:)
First of all note that the original post was alomst year and a half old so dont go by the ideas there now :D
In commodity markets you trade futures and spot. Spot means immidate delivery of the under lying commodity. In futures you pay today for delivery at a future date. So typically the price of the future will be the price of spot + the storage charge (simple calculation to give you an idea considering no premiums). As the day of delivery approaches the price will pull to spot price. For example if west texas intermediate (WTI) crude is $92 spot price the 3 month future will be $100. (92+8 for storage). Considering that the spot price does not change at all, in three months time the price of the oil you will now be purchasing will be $92, but you paid $100 for it. This is backwardation. This is usually how markets are most of the time.
Now if in 3 months the price of WTI is trading at $110, you will own oil you paid $100 for and now can turn around and sell for $110. This is contango.
When you buy a commodity ETF, they dont take actual delivery of the product, they roll their contarcts. So they will hold a 3 month contarct and when the third month approaches they sell the contarct and get another 3 month contaract. If market is in backwardation then they will always be buying high and selling low. If market is in contango they will make money but as soon as it switches back to backwardation they will ride down the slide and loose all the money they made. So I dont think ETF's are agood way of making money in commodities passively. You can actively manage the ETF portfolio and make money using options and hedges and leveraged ETF's. But buy and hold, I suggest go and invest with a CTA who will be trading rule based to negate the effects of contango and backwardation.
Hope this is simple enough:)
srikondoji
04-26 03:16 PM
I will contribute right away.
Thanks
sri
Thanks
sri
No comments:
Post a Comment