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Strategies & Market Trends : Commodities - The Coming Bull Market
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To: jeffrey roberts who wrote (1621)9/20/2007 12:08:52 PM
From: Tommaso  Read Replies (1) of 1643
 
Tom Pope reported early this year that Merrill Lynch would not purchase DBA for him, calling it too speculative. I still do not understand this, especially considering the speculative nature of many things handled by Merrill. Possibly it has to do with the firm's decision to get out of commodity trading ()futures), perhaps a wise decision, since virtually all retail customers who get into commodity futures lose money.

But with DBA, you are buying something that simply tracks the prices of four agricultural commodites. One is not leveraged unless one buys DBA itself on margin. At least this is how I understand it. It's not like a hedge fund that borrows short and lends long, lending on subprime mortgages.
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