Commodity Warrants Australia? - Aussie Stock Forums

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  1. #1

    Default Commodity Warrants Australia?

    Hi people,

    was wondering whether anyone may have used Commodity Warrants Australia before? Or is anyone had any info regarding the organisation?



  2. #2
    Hatchet Moderator doctorj's Avatar
    Join Date
    Jan 2005



    There's an old thread - not much discussion I'm afraid. Perhaps you'll have more luck. Richkid still posts here, perhaps he looked into them more since.

  3. #3
    PlanYourTrade > TradeYourPlan RichKid's Avatar
    Join Date
    Jun 2004


    Hi guys, I haven't looked into CWA since my comments in the thread that Doc refers to above.

    I try to avoid illiquid instruments dominated by market makers. The CWA warrants may well be overpriced. My best guess would be that the new ASX xtCFD's are going to be more liquid and price competitive once the market is in full swing- they only have a few commodity warrants though.

    The main reasons I looked at commodity warrants was to gain exposure to clean trends in commodities; such trends are more attuned to my type of analysis (TA). Warrants would also allow for a more efficient allocation of capital via leverage. It might be useful for you to candidly write down the reason you looked at CWA and to then list all your options for dealing with those initial thoughts (eg want large returns quickly, undercapitalised so found CWA an easy entry option to the markets, wanted to profit from the commodities boom as other have). There are alternatives available (including building your capital base and studying derivatives pricing- see the ASF Derivatives forum). I noticed that CWA had really glossy ads in the investment mags- all that glistens is not gold.

    I still find that the cheapest and most transparent instruments for gaining exposure to major commodities is via listed, highly liquid Austalian co's like LHG, WPL, NCM & CSR (sugar- eventhough CSR is diversified it closely follows the sugar futures contract). You can use corresponding options or exchange traded Warrants or a margin loan to gain leverage.....or you can open a futures trading account if you know how to handle the leverage- too much for me at present.

    Please let us know about your experiences with CWA- especially if they have effective risk limiting devices like guaranteed stop losses.

    My posts are not recommendations (even when I rave about something). Always rely on your own research & judgement.

  4. #4

    Default Re: Commodity Warrants Australia?

    I used CWA a few years ago.

    I guess the biggest problem with warrants is the "time decay" factor. Which starts as soon as the warrant is purchased and starts to erode the value of the warrant. Second problem was there was no "knock out" or "stop loss" at the time that l used them, maybe there is now??? The third problem is that the warrant is placed on order (in the US - COMEX l think) and you have to wait until the next morning to find out if it went through. Not like anything here where (usually) the order is gone through once placed.

    The best thing about warrants is that only the innitial purchase price of the warrant can be lost, while still a highly geared product.
    I did a few good trades, but flopped out in the end. Sorta gotta have big balls in my opinion, take a few risks. And have some cash which can be burned too. If you do happen to pick up a trend, well, can be very good outcome IMO.

  5. #5

    Default Re: Commodity Warrants Australia?

    i went to visit them a year ago to get more information about it, seemed a bit sales-y but i suppose thats what real life brokers do. if you call them they will send all the documentation etc. to you so the PDS will have most of what you need (if you can't download it already from the site).

    you deposit money into a nominated account and they make the trades from that. i'm sure i remember they have knockout clauses now which are essentially stop losses, but talking to one of their brokers will clear up anything.

  6. #6

    Default Re: Commodity Warrants Australia?

    I use them ot get a bit of exposure to the commodity trends.

    Yes they do have "knock outs" or stop losses.

    Anyone else using them?

    I would like to share experiences.

  7. #7

    Default Re: Commodity Warrants Australia?

    where do you start with CWA???

    I was with them for 6 months. In that time I asked a lot of questions that they danced around.

    As far as i could gather, they charge at least 25% more than the option price. presently they have a warrant for Cocoa (17/2/10), and are charging 4125 usd for what is 2X3150 calls. the same option last traded at 1330 USD. so for 2660 USD, you could cover the 20 tonnes of Cocoa providing you have access to the market.

    they trade through MF global.

    I could not fault their research.

    they hit you with a currency trade every time you want to buy the warrent when they clearly have the ability to hold USD denominated accounts. I traded with MF global and that is what i did. so before you even trade you are 4% (Approx) behind the 8 ball.

    they started me on my path to where i am today, which is trading the actual futures contracts. but they are pretty much for mum and dad investors who dont do their research. not a bad place to start, but as you can see they make it pretty hard to get ahead.

    I now trade with IB.

    tried to trade with bells and a couple of others and they wanted to charge $50 a side. IB 2.75 a side!

    That is all I can think of at the moment. hope it helps.

  8. #8

    Default Re: Commodity Warrants Australia?

    Quote Originally Posted by dantheman3000 View Post
    not a bad place to start, but as you can see they make it pretty hard to get ahead.
    I don't post anymore, but...........

    I couldn't think of a worse place to start, or finish.

    They are a rip-off, complete and utter. You can trade all these instruments through ETF's, options or futures for far far cheaper and these guys are salesmen, just as brokers, they are not traders, so they, or their underlying analysts, really have no clue how to make money. Ask CWA to provide you with a track record of clients who have made money or some statistics on averages?

    Sorry, simple truth there. Sad so many people are lazy, have never heard of a decent CTA or hedge fund, and end up listening to a salesman.

  9. #9

    Default Re: Commodity Warrants Australia?

    When first researching investing, I came across CWA and investigated, but warrants were a bit beyond me. Months later I received a call from them saying "we are getting into shares as well as warrants, are you interested?"

    I like to think my crapometer is fairly well tuned (I'll happily read anything but find it hard to believe much), so I said email me the info and I'll have a look at it.

    "Sorry, we only mail" was the answer. Okayyy??!!!

    The mail and some research reports arrived, (very similar to what I can access for free from many sources), so I thought I'd have another look at their website and see what their updated site re shares was like (against other brokers sites).

    No mention of shares whatsoever on their site! Why would you call a potential client and say "come and trade shares with us" and have no mention of shares on your company website?

    IMHO, well, I've already expressed MHO to them on their follow up call (perhaps not to be repeated here); I had to hang up to get the (young) salesman off the phone, and his supervisor asked me the same questions all over again a week later! Same answers and same result!
    Trust... then verify! DYOR

  10. #10

    Thumbs down Re: Commodity Warrants Australia?

    I don't think they know what they are doing. Worst place to start your trading ~!

    Really expensive too !! They are salesmen !

    If I were you, I wouldnt waste a cent on them ~!!

    Utterly disgust

  11. #11

    Default Re: Commodity Warrants Australia?

    Here is an article from todays paper:


    This proves that this crowd is a bunch of snake oil salesmen, trying to fleece all their investors and clients.....

    Stay well away from this mob!

  12. #12

    Thumbs up Re: Commodity Warrants Australia?

    Read the above article ~!

    Finally, all the truth are out ~!

    There is only 1 way for them.... and thats downhill all the way

  13. #13

    Default Re: Commodity Warrants Australia?

    Quote Originally Posted by MACD View Post
    Here is an article from todays paper:


    This proves that this crowd is a bunch of snake oil salesmen, trying to fleece all their investors and clients.....

    Stay well away from this mob!

    lol ... i was just about to post this ... hilarious.
    People who subscribe to the Boileroom or Glengarry Glen Ross philosophy of management are just plain silly in this day and age. It's like trying to be a feminist in today's world ... so outdated.
    With the likes of firms like Google, MSFT and even some of the i-banks might I add ... these sorts of cultures are so delusional and short sighted in their thinking.
    Reputation and integrity counts, and in this day and age of the internet ... people will figure things out.

    Here's a humorus snake oil tutorial: http://www.jurikres.com/snake/main_oil.htm#top

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