Trade Stocks and Commodities with the Insiders: Secrets of the COT Report

CHAPTER 2

Watching the Commercials

Throw away your channel changer.

Every week the Commodity Futures Trading Commission (CFTC) releases the buying and selling done the prior week by the three camps or crowds mentioned in Chapter 1. The official release is made at www.cftc.gov. There is a lot of information there that we will distill down into some specific trading tools.

But, for openers, here’s the way the report looks and what the government has to say about it:

The first Commitments of Traders (COT) report was published for 13 agricultural commodities as of June 30, 1962. At the time, this report was proclaimed as “another step forward in the policy of providing the public with current and basic data on futures market operations.” Those original reports were compiled on an end-ofmonth basis and were published on the 11^th or 12^th calendar day of the following month.

Over the years, in a continuous effort to better inform the public about futures markets, the Commodity Futures Trading Commission has improved the COT in several ways. The COT report is published more often—switching to mid-month and month-end in 1990, to every 2 weeks in 1992, and to weekly in 2000. The COT report is released more quickly—moving the publication to the 6th business day after the “as of” date (1990) and then to the 3rd business day after the “as of” date (1992). The report includes more information—adding data on the numbers of traders in each category, a crop-year breakout, and concentration ratios ...