I start thinking about the New York coffee C market is not an efficient market anymore. It doesn't reflect the real coffee physical market anymore, there are too many distortions.
Brazil with 15 o5 16 points under its is a bz to deliver coffee to the exchange, not for Peru or Colombia and I think is not a bz for Honduras now, Diffs are too high over there.
I think is not a good vehicle to hedge either because at some point teh diffs are more relevant than the basis.
This situation has to be corrected, coffee has to go higher and diffs lower. Then The Coffe market will continue to be an efficient market
And this the theory behind of that
What Is the Efficient Market Hypothesis (EMH)?
The efficient market hypothesis (EMH), alternatively known as the efficient market theory, is a hypothesis that states that share prices reflect all information and consistent alpha generation is impossible. According to the EMH, stocks always trade at their fair value on exchanges, making it impossible for investors to purchase undervalued stocks or sell stocks for inflated prices. Therefore, it should be impossible to outperform the overall market through expert stock selection or market timing, and the only way an investor can obtain higher returns is by purchasing riskier investments.
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