FEATURES
FAIR VALUE
With so many moving parts impacting your crop's price, honing in on a "fair" price is complicated. Maybe the USDA is projecting a production surplus, but exports have started picking up, and the latest weather forecast is presenting risks of heat stress to crop yields. How does it all add up?
Through proprietary, multi-factor, fair value models, Farmer's Market reduces this complexity down to a clear indicator of "fair value", measured on a simple scale of 0 (extremely rich) to 100 (extremely cheap). As you will find throughout the features, 0 always carries negative price implications, while 100 carries positive price implications. The fair value features also include explicit, modeled prices, a historical chart, and clear interpretation signals: "CHEAP", "FAIR", "RICH".
MODEL MOMENTUM
Farmer's Market's fair value features provide you with a sense of cheapness or richness based on the current state of affairs and available data. Arguably more important is the DIRECTION in which the data is moving. Are things getting better or worse for your crop's price?
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With Farmer's Market's proprietary MOMO (Model Momentum) indicator, you will have access to a clear measure of the direction (and strength towards that direction) the data is heading. As always, the MOMO is presented on a 0 to 100 scale, with 0 being extremely bearish (price-negative) and 100 being extremely bullish (price-positive). The MOMO is accompanied by a clear interpretation signal: "BULLISH", "NEUTRAL", BEARISH".
FACTORS
The fair value and momentum features sort through all of the moving parts to provide you with clear, "all-things-considered" measures of your crop's market. But what's underneath the hood? What's driving the price?
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Each Farmer's Market includes a rich set of features to describe the state of up to six factors impacting your crop's price. Each factor is carefully designed to reflect intuitive concepts relevant to your crop. For example, each Farmer's Market includes a "Weather & Conditions" factor to account for things like temperature, precipitation, and crop conditions.
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Each factor receives a strength score, measured from 0 (extremely weak) to 100 (extremely strong). As always, this scale is measured from the crop price's perspective (0 bad for price, 100 good for price). Factor charts with ten years of each factor's history overlaying the crop price are also included.
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Wondering which factors the market has been paying attention to? Farmer's Market provides you with a drive score for each, measuring the strength of the recent relationship between the factor and the crop's price. This score is measured from 0 (no relationship) to 100 (extremely strong relationship).
GLOBAL PRICES
With globalized world markets, it's important to monitor your crop's value relative to prices in foreign markets. Farmer's Market simplifies this analysis.
Each report provides you with relative value scores, weighing the domestic price against prices of five key international markets. As always, these scores are measured from the domestic crop's perspective, with 0 indicating the domestic crop is extremely rich and 100 indicating it is extremely cheap against its international competitors.
OTHER CROPS
Crop prices are naturally linked to one another: farmers choose which to plant, crossover uses (animal feed), similar production inputs. Farmer's Market simplifies the analysis of these inter-crop price relationships.
Each report provides you with relative value scores ranging from 0 (extremely rich) to 100 (extremely cheap), weighing your crop's price against those of up to six related crops. As always, these scores are measured from your crop's perspective.
TECHNICAL ANALYSIS
Identifying price trends, momentum, and support & resistance is a critical component to the analysis of any financial market. Whether prices are reacting to actual fundamental developments or speculators are just driving herd mentality, technical analysis can offer valuable insight into what the market has to say about your crop's price.
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Farmer's Market includes a clean technical analysis chart with carefully selected features to arm you with a graphical window into your crop's price action. To break it down further, each report features five technical indicators, designed to provide you with clear measures of intuitive technical concepts: price trend, price momentum, and volume. Each indicator is accompanied by a 0 to 100 score, with 0 being extremely bearish and 100 being extremely bullish. For help with interpretation, each indicator also includes an explicit interpretation signal as well: "BULLISH", "NEUTRAL", "BEARISH".
FORWARD CURVE
The relationship between your crop's prices at different dates in the future tells an important story about current crop availability, storage costs/carry incentives, the old crop/new crop spread, and so on.
Farmer's Market provides a clean, visual representation of the shape of the current forward curve, along with spread levels for future prices on the curve relative to the nearest futures contract. To put the current curve in historical context, three more curves overlay it, illustrating the shape of the current curve relative to those of one month ago, one year ago, and the five-year average. All three historical curves are anchored to the current curve, making the comparisons straightforward and visually intuitive.
CASH BASIS
Farmer's Market centers its analysis on the nearest futures contract for your crop. To identify geographic price differences and the strength of the cash markets, basis levels for twenty-four domestic locations are provided with each report. Each basis level is dynamically colored to indicate whether it is currently strong (green) or weak (red). Locations are selected with the aim of covering the majority of the major crop-producing regions for your crop.
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Looking for a big picture indication of basis strength or weakness? Farmer's Market also features its proprietary basis strength indicator, which provides a 0 (extremely weak) to 100 (extremely strong) measurement of nationwide basis strength. The indicator is accompanied by an explicit interpretation signal as well: "STRONG", "NEUTRAL", "WEAK".
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