I bought copper for March yesterday evening (though the roll is soon, the cost is not prohibitive). I have been expecting risk assets to rise, and this is a bet on that theme in a market that has lagged other assets. Why has copper lagged? Probably because of the Chinese New Year. It is normally highly correlated with risk assets (R2 to S&P 500 weekly since 2009 is about 0.85) and yesterday’s price put the market well outside the normal range of a scatter plot of copper and the S&P.

This is the first trade I have done in my current process without a stop beyond some extreme point — i.e. that I have entered on the basis of a trend that has started rather than in the expectation of a reversal of a medium-term trend. This is an experimental modification of my process that I have been considering (and writing about in my morning notes) for a while.