Welcome to Croker-Rhyne Co., Inc. We are located in Kennesaw, Georgia (a
suburb of Atlanta) where our only business is trading in the Futures and Futures Options
markets. As commodity futures brokers, we provide extensive research, integrity,
professionalism and a ton experience/perspective as to how to go about trading the
markets. Some general perspective as to who we are.....
Ed Croker has been trading commodities since 1986. Ed grew up in the feed business and
has a degree in Mathematics from Southern Adventist University in Chattanooga. In 1992, he
co-founded Croker-Rhyne Company, Inc., as an Introducing Broker with his broker, Bill
Rhyne. Ed is 54 years old.
Bill Rhyne has been a broker and trader for 24 years. The first ten were with Merrill
Lynch Futures in Atlanta, one was spent in South America, and the remainder here at
Croker-Rhyne Company. He has a degree in European History form Washington & Lee
University in Lexington, Virginia. Bill has traveled extensively and cumulatively has
spent roughly six years living outside the United States. He is 55 years old. Married to a
Chilean, he speaks fluent Spanish (as well as several other languages).
Croker-Rhyne Company is a Guaranteed Introducing Broker affiliated with ADM Investor
Services, Inc. (ADMIS) in Chicago. All funds deposited to our accounts are held by ADMIS
and all broker statements are generated by them as well.
Ed and Bill are also the principals of Croker-Rhyne Capital Management, Inc., a managed
money entity which is registered with the National Futures Association as both a Commodity
Pool Operator and a Commodity Trading Adviser.
Here is a bit of guide to how we approach the
markets....
A Basic Philosophy
&
The Both Sides Strategy
Our bias as traders is very much (but not exclusively) toward the
technical side with our preferred trading vehicle being the purchase of options on
futures, with our typical trade having a three to nine month perspective. What follows is
a brief description of the Both Sides Strategy we most often employ to take our
positions....All references to gains and losses are made with the understanding we are
using long options strategies only.
If you trade futures, whoever you are, much of the time you are
going to be on the wrong side of the market. Our approach to trading assumes we
are going to be wrong, some, if not a lot, of the time.
Futures are inherently volatile. Our perspective is, what we are
really trading is volatility. All the markets will have periods of sideways
action, but all of the markets are frequently trying to move up, or down. Your objective
is to be going with them when they are really going somewhere.
Futures are highly leveraged. Get
on the right side of something which is truly moving and high percentage gains can be a
function of that leverage. It goes without saying that same leverage can also lead to
high percentage losses.
Buying Futures Options allows you to be on both sides of the market
at the same time. Just what it says. You can buy options in both directions
and whichever way the market goes (if it does move), one side will generally benefit from
it, one side will not. Of course, if it doesn't move, neither side will benefit, and
probably lose money.
Select markets which have done nothing for a long time.
If a market has been trading sideways for quite some time, probabilities
"should be" (anything is possible in the futures markets) better it is soon
going to move somewhere. Long sideways move are often followed by large directional
moves.
Or select markets at price levels at which you can make the
statement, " It will not stay here, and, in fact, should move a long way from
here, one way or the other". As an example, you might look at a market
making the same high for the fifth or six time in six months and say, "I don't know
which way it's going, but it's not going to be right here six months form now".
Obviously, it could be, but, again, probabilities "should" favor it moving away
from this old high, and this move could be either substantially up, or down.
(Substantially is also, obviously, a relative term).
When you find something you like, put your money on it, but buy some
options going opposite your opinion. This goes against everything you will feel.
You think you are right or you wouldn't be making the trade. Most of the time, our
recommendations are in units of two calls to every put for bullish opinions, or two puts
to every call for bearish opinions.
There are then three major scenarios....
1. The market does move, only it goes the wrong way.
Your objective is then to sell the options you purchased as "insurance", as well
as those representing your opinion, (whatever they are worth), when, and if, you are able
to put most, or all, of your investment back in your pocket. Our experience is, when
most people (ourselves included) are wrong, they are very wrong. Not only does the
market not move in the direction they anticipated, many times it goes exactly opposite
their opinion in a big way. We find, if we are wrong, using this strategy, even a moderate
move the wrong way may get you most, or all, of your money back.
2. If you are truly right in the market, you will lose the money you
spent on insurance, but you will probably not miss it. If you are right, as a
function of the leverage you work with, you have an excellent chance to make enough on the
trade to see the insurance as only a small relatively small cost of doing smart business.
3. If the market you enter continues to go sideways, you stand a
good chance of losing on both sides. If you get in something which is
statistically "due" (in your opinion) to go somewhere, and it still doesn't move
during the time you are positioned, you might lose all of your money you have in the
trade. But the same trade will still be there and the probability (again, in your opinion)
of an impending move may have gone higher. You can put the trade back on by buying
options with more time until expiration. Futures are inherently volatile. They DO move.
Obviously, there are many, many permutations as to how the markets can
move, and, consequently, what the results may be from any specific position....
The approach certainly doesn't guarantee profitability, and it certainly
doesn't work all of the time, but you CAN be wrong and still get some, if not all,
of your money back off the table (or, it goes without saying, you can lose every
dollar you have invested)....And, when you are right, you
will not miss what you have spent on insurance.
This is a rough outline of a concept developed over a number
of years. There are no specifics here as to how we do what we do; how we make our choices,
how we diversify, how we determine what options to buy, how much time we give a trade,
etc. Suffice it to say, over the years, we have drawn thousands of lines, studied
thousands of charts and indicators, and finally reduced our trading process to what we
think are some fairly simple rules and approaches. If you are interested in finding out
more about what we do, please contact us
by phone or e-mail.
Thanks,
Bill Rhyne
800-578-1001
770-425-7241
Croker-Rhyne Co., Inc.
3215 Stoney Acres Dr.
Kennesaw, Ga.30152 |