Our new Matrix Review blog was developed to show producers how Silveus Financial and our nCompassTM software helps producers visualize risk and scenario plan. We will show hypothetical examples based on real risk management strategies we have developed with our clients.
Standard Matrix: Note the big swing in profitability from +20 to -74 if futures prices fall to $3.38.
The matrix + test: Note the new worst case scenario of -35, the put spread effectively gaining back almost $40 an acre with futures at $3.38.
The trade itself: Buying 25 CZ17 3.90-3.30 put spreads, selling 25 CZ17 4.40 calls for a net cost of 5 cents a bushel.