Back in February I’ve posted an article that the “Red Kite Metals” hedge fund had lost 30% on copper and zinc speculations. The fund somehow survived.
Now it’s published that the fund is down 50% for the year, mostly on copper. Most people still don’t get that industrial metals prices are holding purely on speculation and are bound to fall down. The global economy is slowing and prices on many commodities will fall very soon. If the fund will be forced to unwind the copper may fall even more.
The Achilles last stand is oil, which is still very expensive. But I think it will give up and we’ll see a $70 oil at some point next year