Right. Most people don't know what stocks are in the funds in their 401K much less PE ratios, dividends, returns, fees, whatever. And yet people still invest in it.
It's pretty easy to get into cows. All the lots around here are typically customer owned. Most of them will get the cows bought for you and then feed them out for you. It's pretty common.
But it carries some risk. There are opportunities for HUGE losses. A few years ago, I hauled some corn into a feedlot and asked the ops manager how things were going. He said, "Well, our guys went from losing $500/head to $300/head and they think that is pretty alright." And this is like a 35,000 head lot
All I could think to say was they have a different banker than I have.
There are different things you can do to minimize the risk. You can hedge on the board corn, feeders and fats. That way your only risk is death loss or degraded gain rates.
Typically there is little to no profit to be had by hedging all of your components. Like I said, a month ago you could hedge in a profit, but it won't be the giant ass gains that you always hear about.
Like I said before, I wouldn't do it with any money you ever intend to see again, but there can be money made with them.
All that being said, I've never done it. Dad has a few times, but I have not.
If you want the number to any local feedlots, let me know. I can get you guys that know what the hell they're doing and can explain the process better than I can. Or you can talk to ghak and buy a couple head to get your feet wet. But understand that there can be massive losses.