@katethompson8579

Love the 'yardstick' effect. That makes a lot of sense, thank you!

@krisztiankatona8783

Thanks for this. I found the yardstick effect super interesting. I plan to test it as a quantitative filter for commodity markets.

@Futureprooffill

Thank you. This yard stick is a Big Deal.

@futuresfills5661

Thanks for this guys.

This was an excellent presentation. Thank you. The high frequency stat arb traders are the ones behind the correlation flows for sure. Yardstick effect applies same way in other situations. If value of USD falls relative to the euro, German equities denominated in euros rise even if their share prices in euros stays the same as they are worth more USDs. We should think of commodities like this; i.e., the same way as an FX pair.... Crude Oil/USD, etc. As to the economic regime example, the mere suggestion by then Fed Chair Bernanke in May 2013 that the Fed was thinking about tapering its QE program caused the 'taper tantrum' and the resultant move in the $USD illustrated. It actually wasn't until Dec 2013 FOMC that the Fed revealed the pace of the tapering of the QE, which was to be implemented the following month and cause the QE to wrap up in Oct 2014. Yellen had to trade concessions to wind down the QE and at least do one rate hike subsequent in order to get confirmed as the new Fed chair by the GOP members of the confirmation committee. She indeed followed through with wrapping up QE there in Oct 2014 but of course she continued the maturing asset proceeds reinvestments for another 3 years and raised rates by a measly 25bps at the end of 2015 (and that was it until after Trump won in 2016 lol). Obama went down in history as the only US President with an unprecedentedly accommodative central bank giving his economy a tail wind; and, despite the minute contraction in Fed accommodation leading into the 2016 election, Hillary still lost. Not being political although the Fed obviously is, as per the Maestro Greenspan's words verbatim in interview. Your research looks great and I'm definitely going to take a closer look and perhaps take you up on a trial. Fantastic stuff. Good luck with your business.

@PatrickRooney

Trading commodities and not watching the USD is like driving down a mountain at night without your headlights.

@trimih

What happens in the event of a USD crash or other ‘commodity’ linked currencies