The Rural Voice, 1986-02, Page 21i) Buy Canadian Dollar CALL OP-
TIONS to protect our basis from fall-
ing with a potential rally in the
C -dollar
ii) Purchase December 1986 corn
futures at the 2.20 level to lock in feed
costs — we can't grow it for that!
iii) Watch for weakness in the livestock
complex to purchase CALL OPTIONS
on cattle to lock in replacement cattle
costs.
LIVE HOGS — The hog market was
not immune to the weakness that sur-
rounded the livestock complex in the
last month. February hogs lost 2.98 on
the month to close on January 24 at
45.55. U.S. reports indicate that
average cash hog prices for the year of
1985 were 8 per cent below the levels of
1984 yet average retail prices remained
unchanged for the year. The farmers'
share of the retail price of pork drop-
ped from 48 per cent in 1984 to a
record low 44 per cent in 1985. This
type of action would suggest that
retailers' attitudes toward pricing and
promotion of pork may have changed.
Recent U.S. retailer emphasis has been
on beef and poultry. We expect cash
hog prices in 1986 to average slightly
lower than 1985 levels.
**HEDGERS** might consider a
few strategies:
i) Watch for market fluctuations for
hedging opportunities, 1986 looks to
be a year of ups and downs with no
definite trends
ii) Consider the purchase of December
corn futures in the $2.20 area for a
feed hedge
iii) Consider "writing" CALL OP-
TIONS against inventory to create ex-
tra income.
JUST A WORD ABOUT ... THE
CANADIAN DOLLAR ...
Doom and gloom for those who like
to travel south, but for the Ontario
farmer, our weaker dollar is a big
bonus. Last year at this time, the dollar
was under a great deal of pressure
(some futures markets traded below 70
cents) but yet by the middle of summer
the dollar was back up to .74 U.S. Op-
tions exist on the Canadian dollar. A
June 70 CALL OPTION is currently
trading at about 1.05 - 1.10 points.
This option would lock in a 70 cent
dollar from now until approximately
the middle of June, with limited
downside risk. This strategy should be
of interest to livestock and grain pro-
ducers alike. ❑
The information contained herein is
believed accurate, however, Bache
Securities inc. assumes no responsibili-
ty for its use. For specific recommen-
dations and suggestions regarding stop
orders piease contact your nearest
Bache Office.
David Clarke is an Account Ex-
ecutive with the investment firm of
BACHE SECURITIES INC., 376
Richmond Street, Suite 200, London,
Ontario N7A 3C7, 1-800-265-1570.
SNOWBLOWERS
Superior Design
Open Auger
Extended End Plates
Heavy Duty Ball Bearings
Manual & Power Hoods
Pressed Steel Frames for Added Strength
BARFOOT'S
WELDING AND
MACHINE SHOP
WIARTON, ONT.
519-534-1200
DEALER
INQUIRIES
WELCOMED
Yo
18 YEAR
AVERAGE
ANNUAL
COMPOUND RETURN
10 YEARS 19.8%
3 YEARS 21.3%
1 YEAR 29.3%
That's the exceptional record of
Industrial Growth Fund.
Industrial Growth has achieved a
record of superior long-term returns.
Better still, it's managed for you by Mackenzie Financial Corporation
under a strategy that gives top priority to protecting your capital.
It's the answer to reducing the stress — and increasing the returns — of
your investments. Write or call for details today!
THE INDUSTRIAL GROWTH FUND
vvn
ADDRESS
CITY
PROV.
PHONE
POSiAL
CODE
(Home) (Business)
11/ Mures in December 1, /983 . 1 n, n//e r made onlc be prospectus.
HENRY NICPON
Associate Vice -President Investments
Bache Securities
376 Richmond Street, Suite 200, London, Ontario N6A 3C7 Tel. (519) 673-3600
Watts Line 1-800-265-1570
FEBRUARY 1986 19